The Lodi School Board spoke to a number of residents at the high school Performing Art Center Monday, June 10 about the sale of the old primary school. Many came with questions about the process, the legality and the new owner.
The school district provided a presentation on the steps taken leading up to the 2016 referendum that led to the building being sold. District Administrator Chuck Pursell said they could not legally speak to the issues surrounding zoning for the building, only the process for showcasing the referendum to the taxpayers.
Where it started
School Board treasurer Steven Ricks and Business Manager Brent Richter presented on primary school and the decisions and major points that led to where they are today.
Ricks said they began discussing the primary school in 2006 and hired architects to perform a study of the building, which came out in September of 2007.
“The conclusion was every system in the building was old or outdated and needed to be replaced in the next 10 years,” Ricks said.
The Lodi School District had a community survey in 2014 asking the community whether they wanted to build new or renovate—with a majority voting to build new. In the 2015-16 school year, Pursell said the district held between five to six community meetings and presented on the options they had.
An October 2016 Community Link brochure provided a list of frequently asked questions surrounding the school, with one asking “What will happen to “Old Primary?” The answer was they planned to sell it for an estimated revenue of $180,000. Pursell said this number was based off of a similar school in Sauk Prairie their architects, Plunkett-Raysich Architects, worked on previously that sold for $174,000.
“We thought it was in the best interest to sell it to someone who would use it appropriately,” Ricks said.
The school district then began advertising in local newspapers. One resident asked why the district didn’t use a realtor. Ricks said, after conversations with appraisers and real estate agents, their recommendation was to sell it on their own.
The primary school had 15 interested parties. Of those, five toured the building but only one party submitted an offer. That individual, Duane Steinhauer, submitted an offer for $1,000.
“What do we with a $1,000 dollar offer? That was something we struggled with a lot,” Ricks said.
The School Board had the option of continuing to look for another buyer, sell the building to the City of Lodi, abandon the building, keep the building and renovate it for Community Resource Enrichment and Wellness (CREW) or sell it for $1,000.
Ricks said they determined renovating the building for CREW was not feasible. They also thought about gifting the building to the city but the school district’s attorney Bill Fahey said they did not have the authority to do this.
When determining whether to keep the building running while looking for another buyer, Richter said they had to consider the cost of utilities each month and whether this would outpace any potential revenue.
During the presentation, Richter said the district spent over $64,000 in the 2017-18 school year in utilities for the old primary school. This year, the district has spent over $45,000 to keep it running while they had potential buyers tour the building.
The district also explored the possibility of demolishing the building. They received an estimate from VEIT Construction for anywhere between $375,000-$750,000. These costs range from removing and burying the building to removing the entirety of the rubble and making the site usable again.
Ricks and Pursell said there was misinformation being presented on social media and during their interview with Channel 3000 that incorrectly stated there was a designated $500,000 from the referendum they would use for demolition.
“There was never $500,000 designated for demolition,” Ricks said. “In the referendum proposal, the school district of lodi official did not budget for demolition of the old primary school. Even if we wanted to, we could not use those funds for part of it.”
Pursell said he had misused the word “designated” when he meant “contingency” money during a time when he was determining how much leftover money there would be from the referendum as well as how much they were going to receive from interest on the investment of referendum funds.
He said they estimated between $200,000-250,000 in extra contingency money, and an additional $200,000-250,000 from interest.
“I used the term designated, it was a bad choice,” Pursell said. “They never designated it. It was just contingency money that I knew we had to (use). I thought we’d at least maybe have some money in reserve to try and tackle it. I have since talked to Fahey and he said you can’t use any money to tear that down.”
The leftover contingency money — around $395,000 — will instead be used to go back into the school district for the following:
Middle school STEAM lab
High school fab lab
High school greenhouse
Property purchase for easement to new primary school entrance
Pool frequence drive replacement
Elementary school STEAM lab
Athletic fields storage shed
Resident Susan Goethel spoke out about how acts like this has shaken her trust and confidence in the school district.
“As far as doing the right thing for the community, I don’t think it was thought out at all,” she said. “I’m so disappointed in what happened.”
During the presentation, many came forward with questions about the buyer and why they decided to sell to him. Mike Goethel asked who the school district thought would be the right buyer.
Pursell said the current owner spoke about creating housing and other small businesses in the space. Anecdotally, he said one group of people wanted to use the space for a warehouse, but that didn’t fit their vision for the building.
Pursell was also asked what background information was obtained from the buyer before selling to them.
“The information into that individual about his wherewithal to support this kind of project indicated he had that financial ability,” he said. “Whether or not he was able to do what he wanted to do with the building was not in our purview because that is totally the responsibility outside the school district.”
Other residents near the old primary school, such as Brett Bilzing, said there’s uncertainty about the neighborhood now because he doesn’t feel there’s enough public information about the owner. Members of the School Board said they did what they thought was best for the district.
“We’re not developers,” School Board member Adam Steinberg said. “We go find experts. We don’t have knowledge, we go find knowledge and bring it forward. We act on what we’re advised.”
Attorney Bill Fahey said the School Board’s main objective is to take care of the schools, the district and advance education.
“The school district is not in the business of land use regulation,” Fahey said. “It has to make strong financial decisions for the school district.”
City of Lodi Alderperson Peter Tonn spoke during public input about the Lodi Economic Development Committee discussing the sale of the primary school at their meeting Tuesday, June 11. More information on that meeting will be provided next week.