Selling the school was years in the making

Author’s note: This article is the first in a four-part series about the sale of the former school at 15 N. State St. written in a question-and-answer format. The series attempts to respond to questions about the sale. The articles will also be published on The Journal’s web site as they appear in print.

The first article provides a basic overview of the deal, identifies individuals involved, the buyer’s motivation and the school’s rationale for selling.

The second article addresses the net financial impact for the district, the property’s actual value, the buyer’s plans, and how the buyer hopes to accomplish them.

The third article focuses on questions about the building’s auditorium and on potential title and land ownership issues.

The fourth article addresses the process that led up to the deal and looks at what comes next.

Q: What just happened?

A: Cenate, LLC, a newly-formed business entity comprised of community members, signed a purchase agreement on March 27 to buy the current District Administrative Center (DAC) campus at 15 N. State St. The building has served as a high school, junior high and middle school. The anticipated closing date is July 2.

Q: What are the sale’s basic financial parameters?

A: The sale price is $25,000. Tied to the sale are two leases. The district will pay $1 a year to use the auditorium for up to 10 years. The district will also rent offices in the building for up to two years, at $5,000 a month.

Q: What is Cenate’s motivation?

A: The interest of some current members of Cenate (a name chosen based on the property location at Center and State streets) was spurred by several factors: seeing the district struggle for years to find a suitable re-use for the property; associating that to the city housing authority’s latest study reflecting a need for more market-rate housing; conserving the historic aspects of the site in a way that conforms with the neighborhood; recognizing a need for a community theater; and, though not as tangible, nostalgic ties to the campus, says Cenate Interim President Reed Glawe, who generally serves as the group’s spokesman.

Ten citizens collaborated on a proposal first made two years ago, when the district originally asked for bids on the school. That proposal was made by New Ulm Actors Community Theater (NUACT). Several Cenate members have ties to NUACT.

Though not the successful bidder at that time, when negotiations with another group fell through, NUACT re-approached the district to gauge if it still had an interest in selling. NUACT also broadened the base of its original interest and support by creating a volunteer DAC Community Task Force. The task force met with the district’s Facilities Committee to discuss a purchase agreement and related issues.

Q: Who are Cenate members?

The chartering board members of Cenate are: Reed Glawe, an attorney with Gislason Hunter; James Schuetzle, a CPA with Carlson Highland; Brian Serbus, manager, Southpoint Federal Credit Union; Barb Bornhoft, Senior VP and COO, New Ulm Telecom; Les Schultz, Brown County Probation Director; Oliver Skillings, an attorney; Jeff Dittrich, a realtor, Century 21; Paul Warshauer, executive director, NUACT; Bruce Fenske, publisher, The Journal; and Mary Ellen Domeier, a retired banker and community volunteer.

Several of the board members either went to the school, had children attend, or simply have a nostalgic tie to it. While these individuals comprise the original board and future interim owners of the campus until turning it over to a developer, Cenate will reach out to others in the community to become involved.

Interested individuals should contact any of its members.

Q: Why did District 88 sell the building? It now says it needs more room for students and programs and plans to ask voters for a $45 million bond to build a new high school. ?Why not remodel the existing building?

A: The building at 15 N. State St. closed to classes in 2007.

The trigger causing the move of grades seven and eight out of the school was a fire marshal order that he would not certify the building for student use on an hour-by-hour basis unless multiple facility modifications were made immediately, remembers former Superintendent Harold Remme. The fire marshal said it was acceptable to use the auditorium/gym as a practice and game facility plus for concerts and plays.

Upon review of potential costs to meet fire marshal requirements, the costs were estimated to involve several million dollars, remembers Remme. In addition, significant improvements would be necessary for mechanical and electrical systems in the facility. As a result, the district examined alternatives that would meet short-term student needs as inexpensively as possible.

With enrollment decline still happening at that time, it was estimated that moving grades seven and eight to the main campus by providing a combination of high school building and temporary classrooms would accommodate classroom space needs short-term.

However, shortly after the move of grades seven and eight to the main campus, two things happened, continues Remme. Firstly, an expansion of special education needs required dedication of more classroom spaces for special education services. Secondly, enrollment leveled off instead of continuing to decline. Therefore, the temporary classroom space needs were extended to the present time.

Interestingly, notes Superintendent Jeff Bertrang, when a task force of volunteers considered a multitude of facility options this year, no one suggested going back to the former school.

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