TESD Finance Meeting Update – TESD owns 16 acres in Chesterbrook!

I thank Ray Clarke for attending last night’s TESD Finance Committee Meeting.  In discussion of the 2011/12 budget, the school district is trying to balance the preservation of the quality of education vs. the need to reduce costs and the challenge that struggle presents. 

In reading Ray’s notes, I was surprised to learn that the school district owns 16 acres in Chesterbrook!  This is interesting news to me because I thought there was only one remaining building lot in Chesterbrook and that is property owned by Pitcarin.  Perhaps the acreage owned by TESD is directly adjacent to the Valley Forge Middle School and was purchased should the need arise for expansion to the middle school?  If the property is not located directly adjacent to the middle school, than I am not sure it can be used for building. 

Any readers with more information on these 16 acres?  How did the school district come to own it . . . and why.  Ray wonders if the property is deeded open space.  If this is protected property, I guess I am naive because I didn’t know that TESD owned this type of property. Qyestion — is selling the Chesterbrook property an option?  Don’t know if that is a viable solution (given the current economic situation) but one does have to wonder the value of the property.

Ray Clarke’s notes from 1/10/11 TESD Finance Committee Meeting:

After a great BCS game (which will have pleased Rich Brake!), a few of my takeaways from the meeting. It was taped, so readers will be able to judge for themselves. The focus was on current year performance, the details of the financial projection model and a quick run-through of the “Level 1” budget strategies.

1. The usually solid financial administration stumbled quite a bit in its attempt to explain the details and to reconcile the different looks at the financials and assumptions. It was really hard to follow, and I’m sure the next iteration will be better. It’s important that it is!

2. The current year continues to track better than budget, towards a very small fund balance contribution, depending on unpredictable (really?) movement across the salary matrix. There seems to be an interesting no-cost opportunity for Kevin Buraks’ law firm to ratchet up delinquent collections. Nice to see a budget strategy show up in increased rental income.

3. There’s room to tweak the assumptions in the projection model and its associated $7.6 million gap in 2011/12. Perhaps the base for medical benefits may end up being too high if current experience carries through (but it’s not clear why costs for fully covered T/E employees would have the same experience as the population at large). Also there was a very important discussion about purchased services, often required for special education amongst other things. The message is clear: even if quantity has to increase to meet needs, the only direction for price has to be down. The administration was unable to provide the P/Q split for the projected 5% increase

4. Dr Waters introduced the budget strategy discussion with a statement to which I won’t do justice here, but essentially noted that what worked in the past may not do so in the future and so not all change is bad, that not everything the district does is mandated or essential to educational quality and that the community can choose the level and timeliness of services it is willing to support. Many of the $1.3 million in Level 1 strategies look realistic and even already in place (although a good number are one time), but others need debate and union cooperation. Perhaps $1 million to take to the bank.

5. We didn’t get to Strategy Levels 2 and 3 (need more video game practice?!), but I encourage everyone to find a copy before the next meeting. There are many that look like good ideas, but also many for which I myself would pay more taxes if I were convinced there were no alternative options. And, who knew, there are 16 acres of idle district property right in the middle of Chesterbrook! Not sure if it’s deeded open space or if it’s developable.

6. Some discussion of the next TEEA contract, making it clear to all, as has been pointed out here, that the current matrix will be done on June 30, 2012. After that the district position needs to be: what combination of salary, benefits and deferred compensation comes to a level that the community can afford? Of course, as opposed to that, being frozen on the matrix with no new contract may be a reasonable union strategy (viz: Neshaminy).

Finally, a “Must See” event for the Valentine’s Day Finance Committee – our “Strategic Debt Counselor” will be on hand to prevaricate about the relationship between bond rating and fund balance.

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  1. When Chesterbrook was developed, the developers were required to give the acerage to the school district to compensate for the impact of the development – as a possible future school site. It is not contiguous with the VF MIddle school.

    (I am told there were claims that Chesterbrook would only be “young people without children” and “retired couples” and was sold as having no potential to impact the school system. The truth is we bus over 500 kids out of Chesterbrook. My guess is the supervisors back in the day did not find the “no impact” claims credible, and thus required the developer to deed land to the district)

    Not sure if this property has any commercial value, but during my time on the school board, it was thought to be prudent to hang onto it in case it was ever needed for a school. Having said that, there would be considerable opposition to developing it as a school (or even for athletic fields) given the tremedous amount of opposition we faced when we developed the soccer fields adjacent to VF MIddle.

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  2. TESD owns property on Jefferson Lane ..they’ve looked into developing it before…most recently for storage …I remember it has “deed restrictions” and the terrain was not suitable. Also they own a lot next to Teamer Field on Conestoga RD and the property on Old Lancaster RD which they have “plans” for a multimillion dollar storage facility.(details for that may be annnounced at Friday’s Faciliites meeting)

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  3. Sorry, I could have said more. The possible sale of the Chesterbrook property is Strategy 2N. The land is off Jefferson Lane, quite independent of the Middle School. From a GIS, it looks as though a good part of it is being mowed and there are a couple of paths crossing it. The estimated revenue is “TBD”.

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  4. Decidedly inappropriate to consider sale of land in Chesterbrook. The land was deeded as part of the initial development and is meant for school uses. Once upon a time, schools were part of land planning — Easttown has never obliged when it redeveloped farms or TE would have had land that came from the Greens at Waynesborough (at least for fields) when that huge family tract was developed. It was the wisdom of the supervisors in the50s, 60s and 70s that provided for developers to carve out land for future school sites. In today’s economy, it would be almost impossible for a school to acquire land for school construction. NIMBY as well as prohibitive costs. Kevin G obviously remembers that the neighbors angrily protested the development of fields adjacent to VFMS despite the fact that that land had come with the school and was identified on any and all site plans as “future school use”….and cost the district legal fees to shepherd those plans through. It would be poor vision to sell off land that was GIVEN to the district.

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    Ray Clarke Reply:

    It seems to me that the approach should be to articulate the conceivable uses for this isolated plot, to assess the likelihood of the need for those uses actually materializing, the alternatives for meeting those needs, and the current value of the site. Good questions for the Facilities Committee for all the properties that could be sold (including 738 First Ave and 945 Conestoga Road), but I don’t see that on the Agenda for the next meeting on Friday morning.

    As Dr Waters said, the approaches that served the district well during the period of rapid development of the Townships may not actually be the best ones for its future.

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    School Observer Reply:

    Check out the results of the last time this community was met with huge declines in revenue….they sold two unused and closed schools. Knee jerk solutions to temporary issues. We need to see a longer term in this economy before we do what only panic would suggest is prudent.

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    Kevin Grewell Reply:

    Amen. With future enrolment growth – which is difficult to predict – it is not a good idea to sell any school district land. School Observer is right – it would be very difficult to acquire new land now and in the future. Any short-term gain from a land sale would be far outweighed by long-term cost to the taxpayers when that land needed to be replaced.

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    Pattye Benson Reply:

    Kevin –
    In discussion with a planning commissioner today, I was told that 16 acres is not sufficient property for a new school project. As explained, this property cannot be developed for a new school. Playing fields – yes, new school – no. I was told by another person that under the conditions of the Fox – Chesterbrook arrangement, the property cannot be sold by the TESD.

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    School Observer Reply:

    If the school district needed to build a new school, they could do it. Conestoga is not adequate to have a high school….and the township wanted the district to acquire the nursery. When the nursery made a big stink, the township backed down. We do what we need to do. Selling the Strafford and Paoli schools in a very down time in our community resulted in $1M in the bank. People thought they were wonderful dumping two aging buildings that were filled with asbestos and a declining 70s market. How’d that work out? But I believe that the Fox comment is dead on. It’s moot. It’s desperate. It’s not worth discussion. Smoke and mirrors.

    Libby Reply:

    Pattye,

    As a long time twp resident, the information you rec’d from a P/C member is correct. A long time ago when TESD was looking for property to build, the Jefferson Road site was brought up; but it was determined there was insufficient acreage on which to build a school (either elementary or middle).

    Pattye Benson Reply:

    Thanks Libby.

    Kevin Grewell Reply:

    Well – the Pennsylvania Department of Education (“PDE”) has formulas for how much acerage different types of schools need. The Township may also have its own ideas on that, but if a school were really needed, I think it would be pushed through.

    My recollection is that we were always told the Jefferson Road site would be large enough for an elementary school. The ESC, I believe, is on even less acreage than 16 (but it is possibly “grandfathered”).

    That brings up a point – the PDE is unlikely to say that any site formerly used as a school could not be so used again – essentially “grandfathering” – especially when we are a fairly developed district with few (if any) suitable parcels available for school development.

    PDE would not likely say we could not use an existing site either historically used as a school or specifically dedicated to the district for school use, when such a decision would only mean that the district must condem acerage already owned and occupied by businesses or residences. (we did a study and there are not many – if any – suitable undeveloped parcels for purchase – there are lots of problems, wrong location, deed restrictions, environmental or open space easements, wetlands, sinkholes, etc.).

    When the Consetoga High expansion project was proposed, the “grandfathering” came into question – the school was on less than half the acerage that would be required today, and it was uncertain whether PDE and/or Township approval coulb be obtained, so the acquisition of the Doyle McDonnel property (additional 13 acres) was proposed. When that blew up because of public opposition, the project was approved without the additional acreage by a waiver from PDE and acceptance also by the Township.

    I’m going by memory, but I think that is basically accurate.

    (There was also an “Act 34” hearing, but that has to do with proving to the state that the district could financially afford the project. Opponents of the project thought that the Act 34 hearing was about whether the project should be built, but that is not really what Act 34 is about.)

  5. If the property on Jefferson was ever considered for development, at least one hundred people living nearby would fight it – that’s at least how many dog-owners use the space daily. It is mowed during the summer.

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  6. Maybe the Township should buy the Jefferson Lane land since it’s being used as a dog park and is virtually useless to the school district? Who foots the mowing bill? Does anyone know how much that costs the district every year?

    I’m sure the neighbors would protest if the school district were ever to use the land even as playing fields or a storage facility. It would be worth examining if the land had any value and who would be interested in buying it. Perhaps the money from the sale could be used to buy land that could actually be developed should the school district need it?

    But School Observer is correct. It would be a big mistake to sell land that might be needed for a school in the future. The site of the old ESC is currently the only site owned by the school district that would be suitable for a new school.

    It would be interesting to hear what the facilities committee has to say about this. Hopefully they’ll take a long-term view.

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    Pattye Benson Reply:

    I was told that TESD is responsible for mowing & that they mow twice a year . . . maybe someone can confirm with the Facilities Committee.

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    CHV Reply:

    ESC site big enough for a school ….MYTH…if you read the TESD Infrastructure Report ( that cost big bucks ) their expensive consultant states in several places that the site is NOT large enough for an elementary school..only possible use…… a small building for all day kindergarten IF its ever mandated.

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    Kevin Grewell Reply:

    You may be right about the ESC site being too small for a school – although in a case of extreme need the district might be able to get grandfathered or get a waiver. The problem is that it is actually on small acerage (I forget the exact acerage) but it looks bigger because it is adjacent to the township park. It might very well work for a K center, which could eliminate or reduce the need to add onto all of the existing elementaries or build a new elementary school if all-day K was mandated. The site might still eliminate pressure to build elesewhere.

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    CHV Reply:

    Its was discussed at Faciliites & noted in the report …ESC is less than 9 acres..not enough room… The IDEAL solution would have been to use the plan that showed a new admin building on the site in the back ….the cost was close to a redo ..centrally located..fields in the front..neighbors didn’t object…….Now they pay a monthly condo fee for TEAO..have a meeting room that only holds 85 max,, they ‘re scrabbling for storage ( estimated cost 1.5 million for a new building ) & the maintenance dept. is jammed at the old bus garage….(redo costs could be 3-6 million)……..a lot of tear down without serious plans for the future.

    School Observer Reply:

    Pool and tennis courts. Community recreation center. Someday, the economy will change and that will be under consideration. Count on it.
    Radnor, Lower Merion, Ridley, Council Rock N, North Penn, …. Our community is very fortunate to have the UMLY facility….and very dependent on it.

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    anon80 Reply:

    An interesting concept — sell land that the school district owns which is already identified as “school uses” and buy land that actually could be used with the money. Isn’t the problem that “neighbors would object” — and those are neighbors who bought property KNOWING (pretending not to) that the land was specifically owned/deed to the schools. Just which land would be available for the district to buy? Keep it.
    There is no “data” to confirm that it cannot be used for a school. Scratch that thought. It’s acreage in a town with precious little undeveloped property. Even with eminent domain, taxpayers would have to buy land from someplace if they needed more land.

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  7. I’m amazed at the discussion here. The School District should be a property investment company? An operator of free dog parks? A conservator of open space? Give me a break!

    “What is it good for? Absolutely nothing”, or so it seems!

    We have some data that confirms the land could not be used for schools. What school-related purpose could it have? And is it suited for that purpose?

    If the land actually has any value it could mean that there is demand for development, and that might translate eventually to greater enrollment. The capital realized could be used for expansion of space elsewhere that can actually be used for a school.

    The sale of the old school buildings referred to here was before my time. Can anyone provide the details? What happened versus would would otherwise have happened if we operated the buildings today, and the full costs both ways?

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    Kevin Grewell Reply:

    The sale of the schools was way before my time (on the board) also. I don’t know all the details, but I think they were sold in the late 1980’s. If they had been kept, you would be looking at cost to maintain them (in a “mothball” status) and the cost to renovate them and bring them up to current standards when they were needed again. Whenever you expand something or put an idle building back on line, you are required to bring it up to current standards. That costs a lot of money. Is it more or less than new construction? Who knows? That is an individual case.

    Capacity was added to VF Elementary, Beaumont, VF Middle when enrolment increased again. Who knows how the costs would have compared if the properties had been kept vs. the recent additions? I don’t know how you could calculate that now, and in any event it is moot. The schools were sold, so there is nothing to be gained by looking back now.

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    Andrea Reply:

    Ray
    The schools were closed in the early 80s (maybe even the late 70s) for declining enrollments. There were several reasons those two schools were chosen to close, but no strategic reasons. There was actually a whole segment of the community that rose up to try to protect Paoli from closing. For 10 years or more, candidates to the school board came from a group that came together to try to stop it. Paoli was a lovely little neighborhood school and parents fought to keep it open.
    Regardless, John P is correct in saying that it is moot to contemplate the building outcomes. WHen I lived in Texas, the local elementary schools were leased out during periods of declining enrollment (to child care groups, YMCAs etc) and were subsequently reclaimed when the location was needed.
    Kevin is somewhat correct in saying that the options are moot, but I believe the benefit of looking back is looking at the extensive expansions made to our elementary schools to handle enrollment. With more locations, the size of the schools would be smaller, and the middle schools would not have required expansion because the 5/6 grades might not have moved there. So seeing the short-sightedness of selling property that was part of a master plan for this community in the 50s is worth remembering.

    There is no answering “what would have happened” since it did happen. But as someone who chaired facilities throughout the elementary population expansion and renovation, having those properties would have opened up many, many more options than just adding wings to buildings that were built in the 50s and 60s — all without air conditioning etc. Roberts Elementary in UM — they had the capacity to shut it down and rehab it — no trailers, no temporary classrooms etc. But that’s a lesson that other districts have learned from.

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    Kevin Grewell Reply:

    I agree with Andrea – when I say there is no point in looking back, I mean there is no point in fighting about it now. But Andrea is right in saying there is a point in looking back – so as not to make the mistake of selling land again. She is correct that we did lose the flexibility and options inherent in keeping that land, and we did compromise the ability to chose smaller, neighborhood schools. With an uncertain future, keep all options open as long as possible. This is one reason it made sense to locate the district administrators elsewhere than the old ESC site – if you put the administration building there, you forever lock in that use, and preclude other educational uses which might take some pressure off the system in the future.

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  8. What some if you see as an idle asset I view as a low cost asset with potential. Though a full-size school may not be realistic or needed in the foreseeable future, a smaller centralized kindergarten facility or a grade 5/6 facility would allow exisiting schools to absorb population growth without expanding and tailor their programs to a more close-in-age population.

    Also the reality is that Chesterbook will continue to have many school-aged children, some of whom could walk to a conveniently located school on Jefferson Lane – especially if it were a 5th/6th grade facility.

    But the district-owned property is framed by Mountainview, The Quarters, The Ponds, Sullivan’s Bridge and The Paddock. Very dense housing. So even though there are many young families living in these villages, there are also many retired people and empty-nesters who would probably object to the additional noise and traffic.

    And I’m guessing that given the housing density in this area, the open space is cherished land.

    There won’t be any consensus on the best use of this property, but to sell it would be short-sighted. Its value will no doubt increase as the market improves, and it may be part of the debt-to-asset formula our district uses to maintain its bond rating and borrowing power.

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  9. While I appreciate Libby (?) chiming in, the history of the Jefferson Lane land is somewhat muddled because there is no big desire to locate a school there. It is, however, still TESD land and should remain so. We have no idea what a school will look like in 20 years. We may need cubicles for distance learning. We may have small group rooms for seminars. It might be a building for research. What we also may have is a hard time finding other land without using the power of condemnation. It makes me cringe that people say “residents would fight it” — they bought homes adjacent to land that is very clearly on the deed as future school uses. The notion that if the school needed expansion space that the district (which means taxpayers) would have to fight some residents or planning commission people is painful to read. Just how do communities evolve?

    The Paoli and Strafford schools were closed due to lagging enrollments in the early 80s I believe. (FYI: The Paoli Wildcats basektball league began in the gym at Paoli — hence the name.) Woodlynde bought Strafford and moved from Gulph Mills in 1984. The sale price was $500K per school. At the time, the adjacent park land was not part of the sale, but there is some confusion about that in the old history of the township and I don’t know how that land is titled today. At the time, many congratulated the board for getting it done — because the cost of maintaining the buildings if they were not in use — as well as the ultimate asbestos abatement would have been very high. And $1M sounded (and was) a whole lot of money. As John P says above — who cares? The land was part of the original plan of this community as a site for a school. By selling the land, they basically eliminated the ability to balance enrollments based on residency. Hillside School was also expanded — and is split between the two middle schools. Every elementary school was dramatically expanded in the early 90s — adding science wings and expanding libraries and art and moving music off the stage into music / art areas.

    So — Kate is right. The land is NOT an idle asset. It isn’t an asset and it’s poor thinking to consider it as such. It’s land deeded in perpetuity to the school district. And it’s not too small to be used for some purpose. I think Kevin G. is correct that if the school needed land to build, they would be able to use it. Under the laws about condemnation, you will find that districts have about the same powers as townships…it’s just conciliatory to go to the local townships and planning commissions to work through plans. If you look around PA, you will see that many times one or the other sue each other for land use rights. That makes sense? Taxpayers suing themselves because entities don’t work together.

    So — please quash the notion that the district has any plans, but also quash the idea that “neighbors would fight it”….it’s deeded for school district use. And the fact that this community once had two more elementary schools, K-6, that were filled with kids, and we haven’t knocked down any housing….means we by no stretch of the imagination are at peak. (Actually adding Berwyn Elementary is also relevant. Beaumont was built in response to the “Devon Strafford” apartments — which like Chesterbrook was supposed to be adult housing….and yet exploded Devon and required a little school out there in Paoli….which exploded and was expanded when Easttown approved multiple land parcels for extensive development.
    By the way — EVERY time a new house is built in this community, it costs every taxpayer money if that house has school kids in it. Transfer taxes and property taxes don’t touch the cost of educating school-age residents. The average tax cost per year is $5500 per house. The average cost of educating each child is over $10,000. So anyone with a child in the schools is NOT a true taxpayer – they are getting an education that is partially underwritten by the community. So let’s not push for selling empty land. There is a case to be made that the schools could reduce their exposure to the costs of expansion if it did buy land. It’s also why even if your kids are finished with school, you are not “done” paying for it. (2 years of taxes minimum covers 1 year of school — 2 kids for 13 years is 52 years of taxes)

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  10. I’m just not sure what to make of all this, and I suspect it may be moot if professional advice tells us that the Jefferson Lane site value is limited. (But maybe the ESC situation is different …..)

    I don’t see any lessons from the sale of the old elementary schools (and they were actually schools, not hemmed-in open space) that indicates that those sales were bad decisions. Would we be better off (results, costs) today with more, smaller schools, with all the associated additional overhead? Scale in education, like most activities, contributes to value.

    In the “new normal”, escalating current and deferred compensation costs force a focus on operational efficiencies. There’s no room for nice-to-have options amidst a $9 million deficit.

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    ANON Reply:

    I’m in Ray’s corner! There needs to be some ‘outside the box’ thinking if we are get through this $9 million deficit mess. Wishful thinking or hoping for a brighter future are fine ideas, but reality-check time — we have a big problem and need to find solutions.

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    Why retire in TESD Reply:

    Ray
    You clearly have your focus on one thing — keeping the district from having to raise your property tax. Solutions are not that hard to find unless you ignore the obvious ones. Ignoring consequences is another easy way to find solutions.
    I applaud you for your focus on property tax revenue — but to suggest that there are no lessons from the history of selling the schools is kind of myopic. “Nice to have” is hardly the right adjective for district property that was part of a master plan for thsi community when TE was redoing three levels of instruction to accommodate the elementary population explosion. You wanted to see the benchmark audit report — why? Does it matter where TE stands/ranks in relation to other districts? Apparently not. It just gives TE cover when they cancel programs that make TE what it is. Perhaps the labor unrest in Neshaminy appeals to the cost management side of this argument. Let’s check and see how they bounce back as a community.
    And for the observant few at the meeting — how appalling was it that board members were “asking” if things would be retroactive? Doesn’t that scare the public that the people who will be doing the negotiating don’t know what they are allowed to negotiate?

    And one other question for ray — what is your reference to escalating “deferred” compensation? Except for administrative retirement packages, which can and should be funded/escrowed through the fund balance, I don’t know about any deferred compensation? Is there some?

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    Ray Clarke Reply:

    A few points:
    – The district has very successfully raised my property tax by 50% in a decade. Where’s the limit?
    – Are today’s conditions (educational, economic, technological, etc.) the same as those when the master plan was written, and if not, should we be bound by a vision that did not consider those conditions, nor could it have been expected to?
    – I thought that the benchmarks contained in the audit report would be helpful in particular to compare the size of fund balances.
    – Deferred compensation is mostly pensions and retiree healthcare benefits. My guess is that those and current benefit costs at least double the annual wage compensation.

    I completely agree that the Board’s negotiating team must be at least as well prepared as the union’s.

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    anon80 Reply:

    When did you move here, and what did you pay for your house vs. its market value today?

    Pattye Benson Reply:

    Personally, I think asking Ray the purchase price of his house vs. market value is rather personal.

    Bill Shakespeare Reply:

    @ Why Retire in TESD

    Ay, there’s the rub!

    The fewer retirees that answer that question affirmatively, the lower the demand for houses and the lower the prices, the more likely households are to have students in the district, the higher the district expenditures, the higher the taxes, the fewer retirees, the lower the demand, and on and on and on…..

    And from one of my other plays, Lord Bardolph had some words of wisdom for the Facilities Committee:
    “When first we mean to build,
    We first survey the plot, then draw the model;
    And when we see the figure of the house,
    Then we must rate the cost of the erection;
    Which if we find outweighs ability,
    What do we do then but draw anew the model
    In fewer offices, or at last desist
    To build at all?”

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    Priceless Reply:

    Priceless! (and in more ways than one)

    Kevin Grewell Reply:

    Why Retire (above) has it backwards. The demand for housing – and therefore housing prices – is always driven by younger people with kids who move into the community for the quality of schools, not by how many people chose to retire here.

    Granted, more kids means more cost, but that’s just the way it is. T/E at its peak had more kids than we have now, and some day it could again be a larger student population. That is a cyclical thing. You can’t control it – and don’t forget that the state mandates that we provide a public education for all kids who live here.

    When older folks retire, most downsize. Staying in your home when you retire is another thing. Cost control is the key to that, and is a very “big picture” problem. Cost control will require action by the state legislature to correct some of the problems it has created.

    So far the state has done nothing to help local districts control costs. Act 1 is a mess. Has it produced any meaningful property tax relief? I didn’t think so! How about some relief from unfunded mandates instead?

    As has been pointed out many times before, EVERY school district in the state (all 501) faces the same problem. Are all run by incompetent boards? Really? Not only is that illogical, there is plenty of evidence to suggest that T/E boards over the years have been more competent than most. For one thing, T/E has among the LOWEST school property tax in the state (consistently ranking in the 470’s out of 501 districts). Yet is is among the highest quality educationally. Sure, taxes have gone up, but sell your house and try to relocate into another house elsewhere in the state. Chances are, you will pay more taxes. When you sell again you (or your estate) will get less on the investment because the schools are not as good. T/E is still the best deal around.

    Keep your focus local, continue to complain about alleged incompetence of the board, and you will change nothing. I’ll say it again – HARRISBURG is the key to our problems.

    AS for the ESC, it is too early to tell whether that was a good decision. We may very well see in a few years that banking that land and using it for some educational – as opposed to purely administrative – purpose pays off. One example – if the state mandates all day K, we don’t have anywhere near enough classrooms. We will have to build or add on somewhere, and the ESC site is an attractive option for a K center. If you took K out of the elementary schools, that frees up a lot of space there without building – a cost effective way to accomodate enrollment growth (instead of building a whole new elementary school). Certainly reasonable people can disagree, but there are lots of angles to this. My objection is to oversimplification.

    I can tell you that we studied every land parcel over 15 acers in T/E – and the townships are pretty “developed”. Land is the premium. Suitable options are far fewer than you may think. Any solution that preserves flexibility in use of district owned land is defensible.

    anon80 Reply:

    Professional advice tells us the site value is limited? Which professionals are we listening to now? The professionals that pushed for Chesterbrook in the 60s claiming it would have no kids? The professionals that want a school to have 50 acres for a high school? The professionals on the Planning Commission who wanted the nursery land for Conestoga for additional parking and a ring road to get the traffic off of Conestoga Road?

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    Ray Clarke Reply:

    My thought here was that real estate professionals would be able to provide an assessment of the market value of the property. This would be useful in an analysis of the options.

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    anon80 Reply:

    Market value of empty land in a community where Bottom Dollar Grocery isn’t going to lease the entire Genuardi’s site. “Highest and best use”?

  11. 16 acres — in a lovely setting — and our wonderful facilities folks felt the need to PURCHASE the facility on West Valley Road for 7 million(+) -including retro-fits — in a corporate condominium park — condo fees…
    Gee I wonder what sort of administration facility could have been built on the land we already own…
    The lack of folks with good business sense on the Board continues to be highlighted by such inane decisions.
    And I am told that many of the folks in administration actually felt that the ESC facility was just fine — so just who did make the recommendation to move?? The egotistical school board that had money in reserve??

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  12. I think so. The decision to move to the west valley site clearly was the outcome of collaborative mind think….someone thought it was the right move and somehow everyone went along with it. Kevin G. early made the case why they didn’t want to use the ESC property. It was obviously a collective decision. I have never thought it was anything but poorly conceived. Not only did they buy space in a down office market, but they bought space and had so little control over the common area agreement that they are not allowed to have a sign.

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    anon80 Reply:

    The way school board members are chosen tries to identify skill sets that will be useful, but I don’t think the line is all that long. People can have education and interest and experience, but the skills needed to do well on the board are obviously difficult to identify. I haven’t paid that much attention to the school board until this board surfaced — partly because I didn’t understand much of what they chose to do. I respect them for doing it — but yes — “no wonder the school district is in the mess it’s in” is apt .

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  13. Patty
    Sorry if the question sounded personal. It was not. I didn’t ask what he paid — just what the price was vs. it’s price today…i.e. how has the value changed since his taxes have gone up 50%. I helped a neighbor sell by owner 8 years ago — the house has increased 50 % since that date, as it just sold again for 50% more. Just a question. My own house has doubled in value in 11 years.

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    Ray Clarke Reply:

    Doubtless everyone’s personal situation is different, and I’m not sure that should be the basis for community wide decisions.

    I don’t know what our house would fetch today; the market hasn’t been tested in our development for a number of years except for a foreclosure. Zillow has the value a little less than we paid ten years ago.

    And of course taxes are paid out of cash flow not capital assets, so maybe income levels are a more important benchmark.

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    anon80 Reply:

    I think the point is that the taxes continue to track with property values. I believe paying taxes and supporting programs is insurance against declining property evaluations.

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  14. FYI – Our house in Chesterbrook was recently professionally appraised at 97% above what we paid for it in 1/2000 – that’s almost double our cost – and that is about what similar houses sell for now.

    I think a 50% increase in my property taxes over these same ten years is pretty good!

    BTW – most people I know don’t use Zillow as a reliable source for housing prices – for one thing, it doesn’t take the value of land into account. Checking comparables on realtor.com or other such sites is probably a better option.

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    Ray Clarke Reply:

    The problem is that foreclosures really mess up comparables, and hurt all values to some extent. Any estimate of the market will be a guess until we get an arms length transaction in the neighborhood.

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    School Observer Reply:

    I did not mean for you to precisely identify the results for your property. What I did mean was that taxes have risen at a rate that is supported by the costs to live here. People who pay for a house in today’s market (let’s skip the short sale issues, as around here that’s more due to financing issues) that research the tax burden do so in regards to what they are willing to pay for a house — which may or may not be limited by their income (some folks do not buy ALL the house they can qualify for). The escrow would include taxes and insurance. The taxes have not risen as fast as the property values in many cases, despite your own experience. As a result, the tax rate for TESD is still only about 1-1.25% of property value. That’s not small, but it’s also not unreasonable. So the decision to increase the 1.25% (which is definitely the high end of the current millage rate vs. property value) by .042% with the exceptions vs.014% without the exceptions yields a max tax exposure of 1.302% of your market value vs. 1.268% ….that’s too small a price to pay to quarrel over the exceptions. It IS insurance on the quality of the real estate value. Tax for that and look for cuts after that number.

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    Ray Clarke Reply:

    1% seems like a small number indeed. Hardly worth worrying about.

    The problem is that the numerator is an annual payment, the denominator a capital value. Let’s just calculate the present value of 30 annual payments of $1,000 discounted at today’s Bankrate.com average 30 year mortgage rate of 4.89%.

    Wow, that’s 15.5% of the value of the corresponding $100,000 house, and nearly two months of mortgage payments. $1,250/year capitalizes to 20% of the $100,000 home value, over two months of payments.

    Ray Clarke Reply:

    And sorry, I used a nominal discount rate for a number that for the last decade has inflated at twice the rate of inflation.

    At a 2% real discount rate the schools make up nearly a quarter of the value of a home.

  15. Kevin G — Here ia quote from your post above…
    “I can tell you that we studied every land parcel over 15 acers in T/E – and the townships are pretty “developed”. Land is the premium. Suitable options are far fewer than you may think. Any solution that preserves flexibility in use of district owned land is defensible.”
    Does that mean that you did look at the 16 acres already owned in Chesterbrook???????
    If so — what were the negatives???
    If not — why not…
    Also — it seems that much of the comments about incompetency on the board are directed at the business decisions that have been made in the past 5-6 years – like the 4 houses by the T/E middle school, the ESC decisions, buying rather than renting, the complete silence on the condo fees in any discussion about West Valley, In fact the very simple issue of buying property without any idea or plan on what to do with the prior real estate. Can you do that personally ?? It is easy to spend other peoples money and just like teenagers — money burns a hole in ones pocket, ie, the lame excuse that there was a balance in the facilities capital account — so we spent it.
    And now the blame goes to the teachers and Harrisburg — again a ploy to keep the heat off of the real causes….. like coloring the cement at the high school……. or the cost of the compensation package for the Superintendent… give me a break.

    [Reply]

    Kevin Grewell Reply:

    Papadick,

    Of course the 16 acres was discussed. The idea was – and is – to preserve it as a potential future school site, not use it for an administration building. You miss the point entirely as always. And we knew very well what we were doing with the ESC site – keeping it available for future educational use. My point – which you refuse to get – is that that is a legitmate use of the property.

    And by the way, I’m not blaming teachers for anything – I have not yet addressed that issue. True, teachers get benefits the rest of us don’t and that will have to be looked at as part of the solution. Perhaps that will change in future negotiations given the different conditions which now exist. That will depend on what the economy does, the public’s tolerance for a strike (or not) and whether the legislature decides to level the playing field. We’ll see.

    But when I talk about relief from unfunded mandates, there are many that could be removed by the state without harming the quality of education one bit, and without having anything to do with teachers.

    You can cherry-pick individual decisions all you want to and criticize them. But all of your issues put together don’t amount to a hill of beans. You miss the big picture.

    My point (for the benefit of others, not for you) is that unless enough people start focusing on the big picture and put pressure where it belongs, nothing is going to change.

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  16. Well, I can report that Dr Motel has got quite Shakespearean (per the comment above) in his approach – to future expenditures at least. Discussion at today’s Facilities Committee focused heavily around “draw[ing] anew the model” to minimize the cost of meeting district maintenance and storage needs and solving the problem of the old transportation building on Old Lancaster. It remains to be seen if there truly is a tenable justification for the all the space requirements, but many of the right questions were being asked.

    The Chesterbrook land was not on the Agenda, but in brief comments at the end I got the sense that the Committee has given this some thought in the past and has found, and continues to find, no practical use for it. The District is permitted to sell the land, but the deed does restrict possible uses. So it likely would be hard to find a buyer (I can’t see the Township stepping forward!), but you never know until you try, and in the meantime there is all the ongoing cost and liability associated with maintaining a local dog park.

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    Kevin Grewell Reply:

    Ray,

    The Chesterbrook land does not get much discussion because of two things – one, it is not necessarily where you would want to put a school, and two, there would be a lot of opposition from Chesterbrook residents. Then too, we don’t really need another school right now. But in an environment of rising enrollments, it might have to be used.

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    Ray Clarke Reply:

    What are the factors that might result in rising enrollments?

    More households? More households with families (seniors moving out)? More children per family? Decreasing enrollment in private schools? Less home schooling? More mandated years in school (Kindergarten)?

    What are the underlying development, social and legislative drivers of these factors; how, therefore, might they play out over the next decade, say; and how can the factors best be quantified?

    What then would be the number of children enrolled in T/E by school type, and what space would be required? What are the options available?

    And finally, do the answers to the above suggest that TESD is best placed by continuing to manage the Chesterbrook land or by testing the market for it (with full understanding of all deed restrictions)?

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    Kevin Grewell Reply:

    Ray,

    All the factors you mention are part of the enrollment picture. It is very complicated and is not an exact science. The administration spends countless hours each year on such projections, and briefs the board in detail. This is a large part of the budget discussions each and every year. How many kids you project for next year impacts budgetary and hiring decisions more, perhaps, than any other factor. The district uses projections provided by the Pennsylvania Economy League (“PEL”) which are calculated from demographic and census data (live births, deaths, construction, for example) and averages that with actual experience (cohort survial, straight-line projections).

    Early in my time on the board, PEL came out with an annual projection that was surprising in its departure from the previous year, suggesting that we would soon need an additional elementary school. This PEL projection was subsequently revised, if I recall correctly. However, for a time the district scrambled to determine whether a school would be needed and how soon. That was one of the factors which prompted the study of all available parcels of land which I mentioned earlier. At one point a professional demographer was retained and the future growth of the district was analyzed in great detail.

    We were in a growth period, and although a new school was not built, rooms (wings) were added to VF Elementary, VF Middle, Beaumont, to accomodate the additional students – and to replace the capacity lost when the two schools were sold in the 1980’s (and the third became the ESC, used to house the administration). The sale of the schools did cause a lot of problems, and it would be wise not to make that same mistake again.

    To answer your question – what the data tells us is that in the long run we may very well (in fact probably will) need another school. It would be foolish to sell any land at this time or in the forseeable future. That’s how this impacts the Chesterbrook site.

    You are concerned about costs and taxes. How would you feel if the district sold the land and then a few years later had to replace it at higher cost? It is most likely that land will only become less available and more expenseive as time goes by.

    Kevin Grewell Reply:

    PS to my answer to Ray – I should have also mentioned that the data is crunched from time to time and projected a number of years into the future (ten, I think, if memory serves, after which the projections are not worth much – my recollection is that five years is about all you can really hang your hat on with any accuracy).

    All of the questions you ask such as projected numbers of children by school type, etc. would be good questions for you to ask of the administration. I’m sure they could answer your questions. But more than a few years out, it is a very uncertain and speculative business. For example, you ask about social and economic factors such as how many kids per household and whether they will go to private school or not. That is dependent upon social trends which are unpredicatable and economic factors – in a prolonged recession, for example, people might pull their kids out of private school because they can no longer afford the tuition. On the other hand, home schooling and other alternatives (charters, cyberschools, etc.) may become more popular. Charter schools are “public schools” by law and are not supported by tuition but by taxpayer money, so an economic recession would not affect charter enrollment the way it would private school enrollment.

    Sorry to be long-winded, but it is complex. Bottom line, hang on to your land, you might need it!

    Andrea Reply:

    Ray
    I keep thinking I won’t comment anymore…but then I read something I want to clarify. Re: Kevin’s comments — rooms were added to EVERY elementary school — and the capacity of both TE and VF Middle was increased. We also moved the 6th grade to the Middle School, and then we moved the 5th grade to the Middle School. What accounted for that elementary explosion? So many factors it was hard to keep up with. Not only does the district do very extensive forecasting and modeling, but can anyone adequately forecast what is likely to happen for schools going forward? Even converting to full-day kindergarten would require significant additional capacity at each school.

    At one time, we had 8 elementary schools in this community with K-6 configurations with much larger class sizes than we have now. We haven’t reduced our residential capacity. Conestoga had 2,000 students when it was 10-12.

    There is a hint of desperation in the suggestion that we should try to see if TESD could sell off property that is owned and deeded for school uses. You certainly read the comments in an early post on this site about “neighbors would fight use of the property”….where do you think the district could BUY property that neighbors would not fight?

    The district has periodically used the Jefferson Lane property in negotiations relating to other projects. It’s not an idle asset. Given the decline in property values throughout the commonwealth, it’s hardly a time to consider selling/liquidating the asset. Look at the resistance to Agnes Irwin buying the property on Sugartown road. If things ever required the district to acquire property, it would take creative resources to acquire a larger parcel, and it would take negotiating to generate the approvals to use it.

    Before I joined the school board, I was involved in retail and construction. My company spent countless millions doing forecasting on where to put malls. We bought land ahead of the curve. Well — this area is pretty much already built out. There’s not likely to be a new K of P coming our way. Wegmans may be here, but Genuardis and now an Acme are leaving to make way. We’re pretty set as we are now. But we closed capacity when we sold schools. We do not have that capacity back yet. Hopefully we won’t need it — but it’s a whole lot easier to build on land than to buy new land…and get the approvals to build (or the district would have acquired the Sugartown Road parcel).

    Keep up your vigilance. The board is not more qualified to make the decisions than any of us. But they do have to make decisions. Feedback and follow through help. They have done many things I strongly disagree with — but ultimately the debate is over and the question is called. Every single year.

    Kevin Grewell Reply:

    Late 1970’s or early 1980’s (I don’t recall exactly). I can’t help you because it was way, way, way before my time.

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    Andrea Reply:

    Two names I am familiar with though not sure of the exact time on the board were Ralph Brenner and Eileen MacBeth. Skip Minissi (sp) might also have come from that time. The key public face of this decision – I believe — was Barry Yocum. (That infamous book — “Mr. Principal-Your Activity Period Sucks” by Cecil Mosenson – about those days). Once I was on the board, learned a great deal more about why those two schools were allegedly chosen, though it was anecdotal, not data driven. Quite honestly, in those days prior to the hiring of Jamie McKenzie (the short-term superintendent that preceded Ted Foot), the district didn’t really have a board that was quite as active — it was typically many local lawyers billing pro bono time who met with the Superintendent (Stratton I think — very long term guy) and basically moved forward. This was the same time period when they winked at Devon Lanes without collecting the amusement tax, and ultimately cost the taxpayers $1M settlement against the Valley Forge Music Fair (the money didn’t go the the MF since it was a “tax” — but it went into a trust for kids to go to theater and when I tried to get into those details, I was seriously rebuffed by Judge Gavin’s trustee. ) Things prior to the mid-80s sort of just went along. The closing of Paoli School created an active political group — Carol Aichele, Sue Ciocco Curry, John Bagby and I’m sure countless others (it was before I moved here in 86) came from that core of parents looking for answers.

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  17. Ray — in response to your present value of the tax payment vs. the value of the house….not sure I follow the logic, but I think we can agree that the adage is true: figures lie; liars figure.

    We can manipulate the numbers however we want, but the reality is that your school taxes support the school. The amount you are taxed is based on the value of the home you live in. Renters get screwed because they pay rent and not taxes, but obviously rent in this community has a tax rate the affects the rental. You no doubt pay more for renting here than in a lesser regarded school district. I think the real estate pricing model always has been “Location, Location, Location.” I don’t see a lot of parks, a lot of community services, ponds, etc….so the “location” here is clearly partly due to school districts.

    The price you will get when you sell your house is influenced by the quality of the schools. As others have said here, there are all kinds of models to try to determine what percentage of your house premium attributable to the school quality, but given your model, you say that over 30 years, your taxes for schools will make up 1/4 of what you have spent on your home (if I understand your model?). Can you carve out some percentage (like half?) given that you would be paying SOME school taxes anywhere? Since I believe the taxes here are lower than most surrounding districts, I’d suggest your 25% paid to the schools is really only about 5% paid for premium schools — but regardless. What do you think the house will be worth if the schools decline in reputation? I’m willing to spend the difference between 1.4% increase vs. 4.2% increase to keep from finding out. I consider it mortgage insurance….

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  18. They sold the schools in 1978 or 79..it was called “Action Plan for the 80’s”….the public was quite unhappy.
    My complaint now is the lack of research & money wasted on “plans”.. At yesterday’s Faciliites meeting Tom Daley put forth the “new maintenance & storage building plans”. ( around 3 million)……….how much does it cost the taxpayers for all these ‘great ideas”.. I I sat through countless Zoning & Planning hearings ( lawyer & architect reps there also) when the school district was going to build a parking lot at TEMS…they paid for 2 parking surveys even had the prinicpal do another one ..in the end it wasn’t needed. Now they want to build again . Yesterday.they had NO CONCEPT of how many workers they have or exactly how much space these people need to function or what junk they have to store ( Thanks to Ray for asking ) ….just build it cheap,
    All this “planning ” must cost money.

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  19. Here here to CHV…. I have always been amazed at the amount of money spent on “consultants” and “studies” especially when we have a rather large administration staff – including facilities and technology gurus. There is a ton of money spent on the educational side as well for consultants and studies. So I would question what we get for the salaries spent on these positions.
    Can you give us an idea of how many admin staff were at this meeting. The admin staff spends most of their time sitting in meetings – which in the corporate world is a total waste of time and extremely costly.

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  20. Very good points in the last two posts.

    Planning is good of course, but one problem seems to be that the requirements are not (well) articulated, so the plans are often solutions to the wrong questions.

    Then, the district has essentially out-sourced its facilities planning to an architectural firm. Nothing necessarily wrong with that, but certainly the costs are not transparent. Presumably there is some sort of retainer and then project fees? If the latter is a big component then of course there is an incentive to propose big projects. (Compare our medical system where providers are compensated based on quantity of services delivered). Every project has 20% for “soft costs”.

    I wonder if the Board reviews its options in this area every so often? Outsourcing can work best when there are fluctuations on requirements, yet TESD has a steady flow of capital projects.

    The only admin people at the meeting were the two business guys and Susan Tiede.

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  21. The firm gets a percentage of EVERY project ( I think its 6 or 8 %) except for roofing..also there is an hourly rate of $250 hr for the architect…varied rates for other workers….its under contracted services. ….

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  22. Specialized services. It was a little easier when I was there (constructionbackground) and especially when Phil was there (architect)….lawyers and architects are kind of unique in their skill sets.

    I don’t know why there is so much work for them to do, but the board needs informaton/cover when making these decisions — how else do they get it?

    [Reply]

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