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A 40-year timeline for the Trinity Site Revitalization Project was the sole item discussed during Thursday’s School Board work session.
Superintendent Mary McLeod presented a PowerPoint presentation to the small group of school officials and community members gathered in the Gym at Barranca Mesa Elementary School.
McLeod said the agreement with the county has three terms.
The Initial Term is for one year. The Development Period is for two years and the remaining 37 years will be the master ground lease period or full lease period.
“Before the Initial Term begins we are going to execute a quit claim deed transferring parcel A-8-A on DP Road to the county,” she said, adding everything is subject to state Board of Finance approval.
“The county will then convey approximately 8.47 acres of land near Trinity Drive and Knecht by quit claim deed to the schools,” she said. This parcel will be called District S-1 land.
The amount of land to be transferred to the schools increased from 12.8 acres to about 13.935 acres following a new appraisal in December, McLeod said. The county will retain the 1.3 acre difference, which will be called County Parcel L-1.
The district will then own 98.1 percent of the entire parcel to be developed into Trinity Place.
The Master Ground Lease period begins in year three of the timeline. At this time, the district will begin to see the full income from the lease of parcel S-1.
“The district will move into of the leased facilities at Airport Basin and begin to pay the county $1 in annual rent when the construction has been completed,” McLeod said. “The county will begin to pay the district $1 in annual rent under the Master Ground Lease for the first year.”
During this term the county and the district will establish escrow for leases and conveyances within five days and enter into the development period.
The district will not vacate the two buildings used for administrative offices until a development sublease has been executed with the county.
“During the Development Period, the district will pay the county $439,340 in annual rent for the Airport Basin facility,” McLeod said.
During this same period, the county will pay the district $459,000 under the Master Ground Lease from funds the county receives from the developer, she said.
The district and the county will enter into the Master Ground Lease term once an anchor tenant opens for business or at the end of the two-year development period, whichever comes first, McLeod said. During this term, the county will pay the district $918,000 in annual rent, compounded annually with an increase applied in five-year increments. The county will receive $439,340 in annual rent, also compounded annually with an increase applied in five-year increments.
“At the end of the 40-year timeline, the district will have made just over $24.5 million in lease income,” McLeod said.
McLeod and School Board Vice President Joan Ahlers met with county officials and asked that the county incur the cost of demolition of school buildings on District Parcel S-1. If they incur the full demolition cost – it will run about $3.2 million, McLeod said.
“If the county pays for the demolition then they’ve really helped out the schools,” board member Alison Beckman said.
The schools’ attorney will receive the amended documents next week, McLeod said. The board will hold an executive session Feb. 10 to review the amendments.
They plan to hold one additional public meeting before they vote on the documents at their Feb. 26 meeting.
Ahlers said that the board is trying to conduct this process openly but with negotiations, parties typically try to keep everything close to the vest.
She cautioned that in negotiations, anything is subject to change until the board votes and signs the final documents.