Friday, November 12, 2010

Leggett Amends Peary High School Sale Terms/PTA Opposed to Sale

  • November 10, 2010 Memorandum from County Executive Ike Leggett to Council President Nancy Floreen is shown below. The attachment mentioned in this memo is not included in this blog posting. The original lease of the Peary High School site can be read at this link.
  • The October 18, 2010 Memorandum from County Executive Ike Leggett to Council President Nancy Floreen can be found in this Council packet
  • The Parents' Coalition has been informed that the Montgomery County Council of PTA's Board of Directors has voted to oppose the proposed sale of the Peary High School site. 

November 10, 2010

TO: Nancy Floreen, Council President

FROM: Isiah Leggett, County Executive

RE: Melvin J. Berman Hebrew Academy Exercise of Contractual Purchase Option

This memorandum is a follow-up to my October 18, 2010 transmittal of the Berman Academy's exercise of its contractual purchase option for the closed Peary High School which was closed by the Board of Education in 1984 and transferred to Montgomery County in 1994. Following the conveyance of the property to the County, the County entered into an agreement with the Berman Academy for the long term lease and the purchase option that the Berman Academy is now exercising.

As I pointed out in my previous transmittal, the property can only be used for a school. If it is abandoned, or if it is offered for sale, the County can repurchase the property for the same base land value as the County is receiving plus payment for the building at a price that is the lesser of the then current appraised value of the secular improvements made by the Berman Academy, or ii) the actual costs of the improvements.

On October 25, 2010, the Board of Education wrote to the Council expressing opposition to the Berman Academy's exercise of its purchase option for the school. The Board of Education indicated that "While it is not possible to project our exact facility needs for the future, we know future sites will be needed given the burgeoning enrollments we have seen at all school levels."

In response to this concern the Berman Academy has agreed to an amendment to the exercise of its purchase option which addresses this specific concern and which is arguably even more favorable than what currently exists under the lease. A copy of the Amendment is attached. Specifically, the Berman Academy has agreed that the conveyance does not limit the County's power of eminent domain to reclaim the property for a school. If the County seeks to reacquire it for a school, the Berman Academy stipulates that the reacquisition price is the same base land price and the lesser of the Berman Academy's cost of the improvements or the then fair market value of the improvements. Like the lease, the provision requires a five-year period before repossession is effective to enable the school to relocate. Unlike the lease, this eminent domain right can be exercised at any time. Under the lease the right to repossession cannot be exercised during the initial 25 year lease term. 

I believe that this amendment more than addresses the concern raised by the Board of Education for this school that it closed in 1984. The County should honor the purchase option that it granted to the Berman Academy and that was a basis for the significant investment made by the Academy.

This is a win/win for the County, MCPS, the community and the Academy. The County and its residents get continuing and perpetual use of the ball fields, auditorium and gymnasium without having to pay for their maintenance. The County receives nearly $2 Million during trying economic times and retains the right to buy back the property if it needs the property for a school at the same price it is selling it for, plus the value of the improvements which can never be more than what the Berman Academy paid for them. MCPS is able to reacquire the school if it needs it sooner than it could otherwise. The community receives the continuing benefit of the Berman Academy's stewardship which has contributed positively to the neighborhood. And, the Berman Academy gets the benefit of the bargain the County struck with it in 1996. For these reasons I am urging the Council to act positively on this matter as soon as possible.

If you have any questions, please feel free to contact me or Diane Schwartz Jones in my office.

48 comments:

  1. My husband, family, and I moved to Aspen Hill eight years ago. We knew that we wanted to relocate to Montgomery County, and ultimately decided upon our Aspen Hill neighborhood because of its safety, natural beauty, and central location. We could not imagine what the former Peary High School must have looked like after years of neglect, because when we arrived, we found a lovely school campus.

    The field and the building are used by many in the community, and MJBHA has been most accommodating in sharing its facilities. It seems only fair that the school should be permitted to act on its original contract, and be allowed to purchase the land. MJBHA spent millions of dollars and years of hard work to improve a dangerous eyesore in the neighborhood, and has upheld its end of the leasing contract all these years. MJBHA's offer to sell the land and building back to the County if needed in the future is very fair and reasonable.

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  2. I agree 100% with County Executive. This is a win-win for the County and the Berman Academy. The proposed sale is good for the County and should be approved.

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  3. I am strongly in favor of the proposal of the county to honor its lease with the Berman Hebrew Academy. The School took over a building the county had allowed to become an eye sore in the Aspen Hill community. the Berman Academy spent millions of dollars renovating it and becoming an asset to the community. This investment was predicated on an understanding that the county would honor the lease terms and allow the Academy to exercise a right to purchase the property. the Council should honor that lease now.

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  4. I agree with Amy Hall's comments - and especially want to emphasize that the presence of the MJBHA is a treasure for the neighborhood! People want to live there now since the School represents a unique advantage for many Marylanders.

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  5. Fair and reasonable is not quite how the deal was termed at the time.

    http://parentscoalitionmc.blogspot.com/2010/11/should-county-council-sell-20-acre.html

    For taxpayers to replace the Peary HS site they would have to purchase 20+ acres some place else and build another building. Cost? No where near $1.9 million.

    The land that Peary High School sits on was purchased with taxpayer funds and dedicated for the use of the education of public school children.

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  6. @ Janis- Under the revised agreement the County can reaquire the site "reacquisition price is the same base land price and the lesser of the Berman Academy's cost of the improvements or the then fair market value of the improvements." The price would be 1.9 for the land and completely fair and the County will have the benefit of $1.9 million immediately to put back into the school system today. The School Board does not even know if they will need the Peary School back in the future. In addition there are other school properties not in use that can be used. As a matter of future policy, the County can decide never to sell school land, however, an agreement was made in 1994 and to pull it back now is unfair. The MJBHA parent body and donors would NEVER have raised and invested $9 million to fix an abandoned building if the agreement was not going to be withheld.

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  7. $1.9 million is pennies to the school system's budget - equal to a few hundred Promethean Boards, that's all. (2 years ago MCPS staff bought 3,300 Promethean Boards and that didn't put one in every classroom.)

    In 2006 the new Blair High School cost $37.3 million.

    The tenants of Peary High School have had the use of the building for 16 years? Is that right?

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  8. Janis -

    It's important that you remember that the MJBHA has put in millions of dollars to save the building from the shape the County and the school board left it in - vandalized, molding, falling apart, and abandoned. How much would the County have had to pay to get it into the shape it's in now? And then change the dynamic of the neighborhood?
    Trust me, the old version of this building was nowhere near the standards of a school like Blair - that is a completely unfair comparison.

    The MJBHA took on a tremendous risk - it should be able to benefit from that risky investment. And reaping this benefit doesn't take anything away from the County - no one needs this particular space right now. Read what Ike Leggett said carefully - Montgomery County is getting a deal that is even more favorable for it than what it has right now.

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  9. Date should have read 1998 in above -

    In 1998 the new Blair High School cost $37.3 million.

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  10. @Shuly:

    No one needs a school building right now is an incredible understatement. The public school children of Montgomery County need school buildings. Check out the current conflict between the City of Rockville and MCPS.

    School space is needed all over the county.

    There are 418 classroom trailers on the ground at schools throughout the county.

    http://www.montgomeryschoolsmd.org/departments/planning/PDF/CIP12_Appendix_D.pdf

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  11. I really can't begin to imagine what legitimate reason there could be to stall the sale at this time. It seems to me that MJBHA has more than earned the confidence of the community which is immediately affected (those in the Aspen Hill area) as it has been an excellent steward of this property. There is nothing to lose and everything to gain by the county in approving sale.

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  12. Yes, Janis, but the county doesn't need THIS space right now. The needs are based on the geographical locations and no one is asking for THIS SPACE right now.

    And then tell me where you are going to put the hundreds of MJBHA children who currently learn, play, grow, and give back to YOUR COMMUNITY every day through community service and by sharing this renewed space with everyone around.

    Why is it okay for you to care more about MCPS Promethean Boards than keeping hundreds of current MJBHA students in the right space for them??

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  13. @ Donna - School land and school buildings are desperately needed by public school children.
    The cost of building new schools has gone up significantly. Land is at a premium.

    Please name what taxpayers "gain" by selling this piece of land for pennies when it is assessed at $33,162,766.

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  14. @Shuly - This land is public school land. Purchased by taxpayers and held in trust for the use of public school children. That is the reality. Taxpayers made this investment to support the public education of Montgomery County children. So that all Montgomery County children would have access to a free public education.

    There are some 10,000 public school children being educated outside in trailers right now.

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  15. Janis - If the MJBHA had not come in to save and repair this building and this land, no one would be able to use it - not us, not you and not any public school child. It was COMPLETELY UNINHABITABLE. The County did nothing to change that. That's what County taxpayers should be upset about.

    The County allowed the land to be rented and of the 10 interested parties, 9 dropped out after seeing what a wreck it was. Only the MJBHA took this risk. The County owes MJBHA a debt of gratitude for taking the risk - and for turning a County liability into an asset. Everyone on the County board is aware of this - and that's why they are willing to work out a compromise.

    And please remember - EVERY parent who sends their children to the MJBHA is a taxpayer, too. And thanks to the MJBHA families, there are many fewer children taking up spaces in public school classes, and using all the other public resources that we PAY for but do not use.

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  16. @Shuly, Vacant school land is held in trust for public school children. The land in question here is currently assessed at $33,162,766. That is what this piece of public school land is worth to taxpayers.

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  17. The issue here is not the cost of a new school for the Montgomery County School System or the "investment" in public land made by the County almost 50 years ago. That ship sailed when the County entered into the Lease Agreement with a purchase option described in the County Executive’s memorandum (above). The issue is whether it is reasonable for the County Council to withhold its consent because of potential changes in demographics. It is not. Changes in demographics are as foreseeable as any other change in the County over a long-term lease. To read a change in demographics as a legitimate reason for withholding consent is to read the purchase option completely out of the Lease Agreement. That option is part and parcel of the Lease, and can no more be read out of the Lease than the payment terms. If the County wanted to reclaim the school it retains the right of eminent domain. Nonetheless, Some members of the County Council appear to want to have it both ways, i.e. rejection the purchase option but not take back the school. That would be both dishonest and dishonorable. So please focus on the actual contract and not some other contrived argument that puts the County and School Board future planning on the backs of a legitimate exercise of a contract right by a stellar member of the Aspen Hill Community. If the Council doesn’t enforce the Lease the courts will -- and at a substantial cost to all parties. Ask the County Attorney -- he has already advised the Council as much!

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  18. But this is not vacant land - it's only inhabited - and inhabitable - thanks to the private investment made by MJBHA and to the agreement that the County made to allow for that. You're making it seem as if MJBHA is violating the rights of taxpayers and public school children. It is not - the MJBHA has a binding legal agreement that gives it the right to exercise an option to buy the land at this price.
    Plus, the land was not worth anywhere near $33 mil before the MJBHA invested in it. Did you see the building before MJBHA renovated it??

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  19. But this is not vacant land. And, the County agreed to allow the MJBHA to rent this land with the option to buy it - MJBHA has a binding, legal agreement that gives it this right. We're not taking anything away from other taxpayers (remember, MJBHA families are taxpayers, too).
    Plus, before the MJBHA invested in it, the land was worth nowhere near the 33 million you mention. Did you see the building before MJBHA renovated it??

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  20. That assessment is based on commercial use, which the land is not and can not ever be used for, under the contract MJBHA has with the County. The heart of the issue here is not whether or not the building might be needed by MCPS in the future, nor if the deal is fair, nor all the great things the school has done for the property and the community. It only matters that the County entered into a legal contract with MJBHA and has a legal and moral obligation to uphold that contract. Whether you are for or against the sale, as citizens of Montgomery County, how can we allow our Councilmembers to even think that there is any other option?

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  21. The assessment is from the Maryland State Department of Assessments and Taxation. High schools in Montgomery County run $80 to $100 million and hold 2,000+ students.

    Peary is a high school sized site. Land is land. This much public school land in Montgomery County would educate 2,000+ students - not a few hundred.

    @9:33 - threatening litigation? That's a nice community sentiment.

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  22. But Janis - you're not understanding the issue here. The question at issue here is NOT whether Montgomery County will kick MJBHA kick out of this space - IT WILL NOT. (Even though that sounds like what you'd prefer). The question is whether MJBHA can EXERCISE ITS RIGHT TO BUY the building and the land. This is a RIGHT that is part of its CURRENT CONTRACT. Your comments are really out scope here since they do not take into consideration that THERE IS A LEGALLY BINDING CONTRACT here.

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  23. A contract was signed. What is the point of signing such a document if it can be torn up without very extenuating circumstances. I am not a lawyer, but If I sign a document I expect it to have more value than the paper upon which it was written. Good Luck MJBHA. R.

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  24. I am reading through all the postings;I don't doubt that there are students attending classes in trailers or that their classes are filled to capacity.However, I don't see the county running to open new schools in your vacant buildings. I urge you to look to see what the Peary school looked like before MJBHA stepped in. We salvaged a drug infested building, with funds we raised from investors with the understanding that we could purchase the property. You state that it is valued at $33 million; it goes both ways, if the county ever wants it back, you would only have to make us whole, not pay us $33 million. A contract is a contract. This county council may not have signed the original contract, but it is binding and needs to be upheld.

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  25. @1:40 PM: Then you aren't paying attention to the re-opening of public school sites. You are way behind in your tracking of the MCPS Capital Budget.

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  26. Why did the county abandon the Peary school in the first place? We invested our own money to repair and rebuild and now you say you may want it back? The Aspen Hill community owes the MJBHA a debt of gradtitude for rescuing their community. I am happy to hear you are re-opening public school sites; it still does not address the leagal issue of having a binding contract.

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  27. Speak directly to the 10,000+ students being educated in classroom trailers for the foreseeable future.

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  28. So, since hind sight is 20/20 ... you would have kept the old Peary school, never abandoned it and would have spend the millions we have spend to renovate it? However, you did abandon the school, and we did step in,rescue the school and the county. In addition, we do have a binding contract therefore the council really has no option but to agree to this sale

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  29. How many of those 10,000 students in trailers are at the high school level in the Aspen Hill/Rockville area?

    I live in Aspen Hill, within blocks of the old Peary site and current home of the MJBHA. My daughter attends Rockville High School. Rockville was recently renovated, was not significantly enlarged, and has NO trailers. Where is the overcrowding in this area?

    Earle B. Wood Middle School is the only Middle School in the Rockville Cluster. It is located in the Aspen Hill neighborhood. It also has NO trailers. Again, where is the overcrowding in this area?

    Parkland Middle School, also in Aspen Hill, but part of the Downcounty Consortium, was also recently renovated. It also has NO trailers. I ask once again, where is the overcrowding in this area?

    What would you have Peary reopened as? A high school? Rockville HS is adequately sized for the foreseeable future or it would have been expanded. A middle school? Wood MS and Parkland MS are adequately sized based on growth projections or Parkland MS would have been expanded.

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  30. Looks like everything is all wrapped up. The Board of Education has met in a secret, closed, unannounced session and reversed their recommendation according to MCPS staff.

    Looks like the back door process is working.

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  31. Thanks to the poster above who pointed out the absurdity of the students in trailers argument. Yes, there are trailers in certain parts of the county, but NONE at the secondary schools in the Aspen Hill area. How would reclaiming the old Peary HS fix the trailer problem? The only way imaginable is through massive redistricting and shuffling of secondary students. Yea, sure, the citizens of Montgomery County would certainly be on board with that!

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  32. Do you live in a bubble? Say hello to the Down County Consortium and the Northeast Consortium. Students are shuffled all over Montgomery County every day.

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  33. Those students are shuffled by CHOICE, not by mandate. If you bothered to read and digest what I wrote instead of racing to the computer to hurl an insult, I wrote that the only way reclaiming Peary would fix the trailer problem is through massive redistricting. That is NOT a choice.

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  34. @10:31 You have made a choice to ignore how MCPS is run. The establishment of a magnet or other program is used to fill and redistribute students all the time.

    It is clear that a number of responders on this post do no have children in public school and are not familiar with the many ways that students are moved around in the county.

    From magnets, to immersion, to consortium, to programs for special education students are distributed around the county to fill available space in schools.

    Pretending that Aspen Hill is some sort of island that is immune from the needs of the rest of the county is ridiculous.

    MCPS is a county wide school system. The Peary High School site was purchased by taxpayers for the benefit of public school children, all of them. That's the way our state system of free public schools works.

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  35. Once again, parents CHOOSE to send their children to a magnet or an immersion program. If they live within one of the consortiums, they get to CHOOSE which school within the consortium to send their child. Redistricting is not a choice, and that is what would have to happen for the 10,000 students in trailers argument to have any validity whatsoever.

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  36. Clearly you missed the Board discussion on November 18th. Moving students around is done all the time and is not a problem for the Board of Education. There are lots of ways that students and programs are moved and lots of ways to use available space.
    The 10,000+ students in trailers has lots of validity and the Board of Education and Superintendent are talking about those children a lot these days.
    School space is desperately needed in this county wide system.

    The Peary High School site is currently being underutilized with only 700 students in the building. That's the size of an elementary school these days. High schools run 2,000+.

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  37. If, as you claim, high schools in Montgomery County run 2000 +, the current building on this land would have to razed or significantly enlarged as its capacity isn't close to that number. This school would also have to be made part of a consortium for your argument to hold water. Would you add it to the DCC?

    By the way, there were 8 out of 25 MCPS high schools with enrollment above 2000 in the 09-10 school year. Two additional high schools had enrollment between 1900-2000. To state that high schools run 2000+ is an over-generalization.

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  38. Here's the contact information you need:

    Patricia O'Neill
    President
    Board of Education
    Montgomery County Public Schools
    850 Hungerford Drive
    Rockville, MD 20850

    Write to the Board of Education and tell them why they are wrong about the classroom needs of public school children in Montgomery County.

    We will be happy to post your signed letter to them on this blog.

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  39. The bottom line is there is a contract that the county has with MJBHA and they should abide by it. What message is our county sending to its constituents, adult and children alike, if they reneg on an honest deal?

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  40. Where in the contract does it say that the County Council "must" approve the sale? Please cite to page and paragraph.

    Thanks.

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  41. Janis - why are you so opposed to the sale?

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  42. Janis - I would also recommend you do the math as to how much it would cost the county if all 700 + plus the 25 + special ed. students housed at MJBHA.

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  43. To recap - The Board of Education and the Superintendent are on record as opposing the sale of the Peary High School site.

    MCCPTA has also said that they are opposed to the sale of the Peary High School site.

    MCPS staff has said this is one of the largest school sites left in the county.

    Still waiting for the part of the contract that says Peary HS site "must" be sold. Also still waiting for copies of the 3 appraisals. Look forward to making those documents public.

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  44. Janis, MJBHA has fulfilled the terms to exercise their option why is this sale an issue for you as the Board of Education allowed the building to fall into disrepair and then transferred deed to the county? Had the Board of Ed properly maintained the building, the County would not have requested that MJBHA and others submit bids to improve what had become a blighted site.

    Furthermore and perhaps of greater importance, had MJBHA not stepped in, the site would have been razed and a park created in its place. At some point, the MD Capital Park and Planning Commission would have assumed the deed and if would be highly unlikely that they would ever transfer the deed back to the County or MCPS.

    So basically, MJBHA helped save the Aspen Hill community and even now MJBHA is willing to sell the school back if there is a genuine need.

    Seems like MJBHA have been tremendously beneficial to the County.

    It would seem that MCPS should thank MJBHA for their significant accomplishments and certainly not oppose this sale.

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  45. And so what qualifies as a "genuine need?"
    Please define.

    Public school property is held in trust for the benefit of public school children. The 10,000+ currently in classroom trailers don't benefit from the loss of public school land.

    Also, waiting for copies of 3 appraisals and citation in lease to section that says property "must" be sold.

    Let's see some transparency, let's see the 3 appraisals.

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  46. Leggett said "The County receives nearly $2 Million..."

    no - more like $800,000 after the State receives their cut - but who's counting. It's just money.

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  47. I am a parent with children at MCPS, and am usually an advocate of the Parents' Coalition's stand on issues BUT I strongly agree that MJBHA is entitled to this property. Stop acting like a child who decides that he/she wants a newer version of their toy after they have lost it years ago. Should have, could have, would have - TOO BAD - the contract was signed and MCPS has to deliver. I feel sorry for MJBHA who has had to endure this bs.

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  48. @1:30 AM
    Bravo! That is the bullying mentality that works so well in Montgomery County!
    Public school land is first and foremost public school land - even when it is transfered to the County.
    Have you read the County regulations on public school land transfers? Did you see any of those regulations that were followed?

    Have you read the Contract? It's does NOT say Montgomery County has to deliver anything. In fact, Montgomery County CAN'T convey the property without the State of Maryland's approval.

    County Executive Ike Leggett tried to tell the State of Maryland that the school building had been demolished, but that was not the case. The State of Maryland is now evaluating their share of the sale proceeds. The State invested $1.1 million in the Peary High School building and is entitled to their share of the proceeds.
    Why did County Executive Ike Leggett tell Council President Nancy Floreen that the County would get "almost $2 million" from this sale when that is not the case?

    $800,000 for 19.5 acres is a super deal.
    Some would call it a give-away at a time when the County budget is in serious trouble.

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