Pattye Benson

Community Matters

Pattye Benson

Outsourcing of Custodial Services Would Save T/E School District Almost $1 Million . . . Should this Cost-Cutting Measure be Considered?

March 15, 2011
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Last night was the T/E School District’s Finance Committee Meeting. One of the solutions offered to help close the looming deficit for the 2011-12 school district budget is the outsourcing of the custodial services. Outsourcing of the custodial service is expected to save the school district an estimated $950K in the budget. Last night, several members of the district’s custodial union (many of whom are township residents) attended the meeting to make the case to preserve the current custodial arrangement.

From Pete Bannan’s article in today’s Main Line Suburban newspaper on TESD Finance Committee Meeting, Pete reports:

” . . . All the school-board members were present for the meeting and the pleas during the public comments did not fall on deaf ears. Finance chair Kevin Mahoney said the school board wasn’t doing this to save money but is required by state law to balance the budget.
“The options are evaporating,” said Mahoney. “The governor’s budget turned a $2.2-million shortfall into a $3.6-million shortfall. It’s simply a matter of economics.”
Mahoney said no decisions had been made. The proposal is due April 4 and the board has 120 days to review it. Mahoney also said the school board is open to ideas and constructive ways to reach its goals. He suggested the public contact elected state officials, such as State Rep. Warren Kampf, State Sen. Andrew Dinniman and Gov. Tom Corbett, and ask for real pension reform. . . “

Ray Clarke attended the Finance Committee meeting and offers the following notes for Community Matters readers. As always, I am grateful for Ray’s attendance at school district meetings, his analysis and then for sharing them with us!

Monday’s Finance committee meeting vividly illustrated the problem TESD finds itself in.

Very many TENIG (Tredyffrin Easttown Non-Instructional Group) members and others spoke about the value of the current system with experienced, stable, professional and flexible staff, compared to the risks of a possibly cheaper, but high turnover, less trustworthy, and less committed external provider. There was also commentary about the impact on diversity. There was much talk about membership in the T/E Family, and a wise – but unfortunately innocent – CHS student suggested that a family would sit down and work out a fair solution for all its members, rather than focusing on one group. (No prizes for guessing the elephant in this particular family room!)

The out-sourcing analysis does offer a glimmer of hope, though. The district has issued an RFP, responses due May 4, which then must be given to TENIG by May 11. TENIG is allowed 120 days to respond. Let’s assume that out-sourcing would really save the $950,000 estimate. Now, the district has already identified overtime and substitute strategies that would save $150,000 with the existing staff. Is it wishful thinking that the staff could use their professional experience to identify further cost-saving practices, and offer compensation roll-backs and benefits adjustments that could move the impact over 50% towards the expected cost savings? Taxpayers might be very willing to pay a premium for service assurance.

After 90 minutes the committee got down to a review of budget projections. The $1.3 million impact of the PA budget was confirmed, with the $1.1 million reduction in Social Security reimbursement to the 15% “aid ratio” being the real surprise. Apparently it has been at 50% for as long as anyone in the room could remember. I would think that this might be subject to lobbying: where is Kampf on this one? It apparently squarely targets districts like TE that have a low aid ratio.

There was agreement to move ahead to crystallize a number of strategies listed with low or moderate impact on the education program. The biggest ones:

– Change the prescription provider: Impact $250,000
– Eliminate raises for all non-union staff: $395,000
– Integrate Applied Technology into Elementary Core: $300,000
– Plan for a 5% increase in medical costs (vs previous 10%): $412,500
– Fees for extra-curricular activities: $80,000

The result of all of this is $2.3 million of fairly solid strategies (including all the above except the last) and $0.45 million of more speculative ones (including the last). The current scenario assumes $0.15 million of the specualtive ones, for a total of $2.4 million of strategies. Add in Act 1 and Exception tax increases of $3.2 million (3.8%), subtract the $1.3 million state cuts, the $8.9 million deficit comes down to – a mere – $4.6 million.

Board policy does place some limits on use of the Fund Balance, but one obvious use is to pre-fund approved programs implementation-limited by contractual attrition rules. There was an example presented of how $1.1 million could be designated in this way in 2011/12. (I worry that there might be a little double counting with the above $300,000 AT elimination – does that need attrition?).

It’s fairly clear that the $29 million Fund Balance could absorb the $4.6 million draw down, but beyond that the picture is bleak. Annual deficit projections of $10 million or more (after Act 1 tax increases, driven by benefits) show that the district can not afford even flat TEEA salaries without the fund balance being wiped out in 2 years.

Here’s where the State House Bill to allow teacher furloughs to balance the budget comes into play. According to Dr Waters, that would allow action even with a CBA in place. However, Dr Brake reported that although the bill was up for Committee hearings, those hearings were abruptly cancelled (!). But the legislative process does continue, apparently.

We know that there are some actions involving furloughs that are already approved as having minimal educational impact. Others, like modest increases in class sizes, might be similarly low impact. Getting to $10 million can hardly be done without real impact, though. When it comes down to students and jobs versus union compensation, we might find out who is really part of the TE Family.

Gov. Corbett’s Proposed Budget Indicates -9.69% Change in State Public Education Funding for T/E School District

March 14, 2011
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The dust has begun to settle on Gov. Corbett’s proposed budget. Although most areas of government were not exempt from cuts, the decrease state funding to higher education and school districts may have the greatest effect on local residents.

In reviewing the governor’s budget proposal for public school funding, Sen. Andy Dinniman offered the school districts current state funding vs the proposed funding.

The table below from Dinniman’s website (www.senatordinniman.com) is interesting because it focuses specifically on the state funding to our local school districts, including TESD. The statistics indicate the current funding for public education versus the funding contained in the governor’s proposed budget. The decrease in state funding ranges from $446,269 in the Great Valley School District to Downingtown School District’s $2.9 million. The funding loss is due to Corbett’s proposed elimination of the Accountability Block Grant and Education Assistance programs.

Although Tredyffrin Easttown School District is grateful not to be in the $2 million + budget cut category of West Chester and Downingtown school districts, we are far from exempt. According to the table below, TESD proposed decrease in state funding equates to an approximate -9.69% change or $479,569.

“Governor Corbett’s proposal for basic education will be disastrous for our Commonwealth’s public schools,” Dinniman said. “Full-day kindergarten classes, reduced class sizes and after school tutoring programs are at risk of elimination.”

“The difficulty is that while the governor can wave the flag and say, ‘We’re not raising taxes,’ he has written a script that will mean significant local property tax increases and much heavier burden on local taxpayers, and that is indeed troubling,” Dinniman said.

It will be curious to see if Corbett’s significant budget cuts to public education enters in to the discussion at tonight’s TESD Finance Committee meeting. The Finance Committee is at 7:30 PM in the Tredyffrin/Easttown Administration Office (TEAO) at 940 West Valley Road, Suite 1700 in Wayne. Click here for the Finance Committee agenda.

March Ahead Sunday, It’s Daylight Saving Time

March 12, 2011
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Clocks will spring forward at 2 AM Sunday as Daylight Saving Time commences. Don’t forget to change your clocks.

Why do we observe Daylight Saving Time, other than to enjoy an extra hour of summer sunshine? Daylight Saving Time is a way of getting more light out of the day . . . the sun appears to rise one hour later in the morning, when people are usually asleep anyway, and sets one hour later in the evening, seeming to stretch the day longer.

For one night (tonight) we have the reality of 60 fewer minutes of sleep, but ahead are many months of an extra hour of evening sunlight. Starting tomorrow, there will be a little more “day” in everyone’s day.

But, why change the clocks at all? Is it really worth having to readjust our internal clock by an hour twice a year? Do you know who came up with this idea of saving daylight?

Benjamin Franklin often receives credit for the idea of what we now call Daylight Saving Time. As an American delegate in Paris in 1784, Franklin published an essay titled “An Economical Project,” in which he made the simple argument that natural light is cheaper than artificial light. However, what many people probably don’t know is that Franklin’s essay was written, rather tongue-in-cheek; he actually wrote it as a joke.

Franklin knew that the Parisians were notorious for ‘sleeping-in’, and he wrote in the essay that he was accidentally awaken one morning at 6 AM, only to “discover” that the sun actually shines at that hour. This got Franklin to thinking and he calculated that if he slept until noon (as he wrote was usual in Paris!), and then stayed awake six hours later in the evening, he would have “wasted” the free daylight and would have to pay for it with artificial light.

With a humorous bent, Franklin went on to offer some “regulations” that might aid in saving money. These included a tax on every window built with shutters, rationing candles, limited horse-drawn carriages on the streets after sunset, and ringing church bells and firing cannons at sunrise to wake everyone up. He wrote, “Oblige a man to rise at four in the morning, and it is probable he will go willingly to bed at eight in the evening.”

Franklin’s idea of making better use of daylight hours . . . “saving” daylight actually was not put into practice until the 20th century. The practice of setting the clocks ahead one hour in the spring in order to make better use of the daylight hours was first put into action during WWI as an effort to save fuel.

Not everyone in the U.S. makes the switch from standard time. The exceptions are Hawaii, most of Arizona, Puerto Rico, the Virgin Islands, American Samoa, Guam and the Northern Marianas.

So, most of the nation will try to adjust to “springing ahead” or “marching ahead” an hour before going to bed tonight (or scrambling to do it Sunday morning).

It’s not all good news for light-lovers . . . the change does mean an hour less sleep tonight!

On School Voucher Question, State Rep Kampf offers a ‘Wait and See Approach’

March 11, 2011
12 Comments

On Thursday, March 3, I emailed State Rep. Warren Kampf in regards to the proposed school voucher legislation. I followed up my email with a telephone call to his Paoli office on March 7. At that time, his chief of staff, Sean Dempsy spoke with Rep. Kampf re my email and offered that Rep. Kampf would have a response to me by the end of the week. Here is an excerpt from my email to our State Representative, which I posted on Community Matters last week:

“ . . . There has been much discussion about the proposed school voucher bill S.B.1. which would help the state’s poorest children from the lowest-performing schools by providing options of attending public, private or parochial school. This week the Senate Education Committee voted 8-2 in favor of the bill and the proposed legislation will move forward in the process.

It is important for constituents to know where our elected officials stand on all important issues, including the school voucher program. State Senator Andy Dinniman (D-Chester) serves on the Senate Education Committee and voted in favor of the proposed school voucher legislation. As our State Representative, could you please offer your thoughts on the proposed ‘opportunity scholarship’ legislation? In your response, please address specific issues including the plan’s estimated price tag of $860 million, the constitutionality of the proposed legislation and the issue of funding parochial schools with taxpayer money.”

Rep. Kampf did not respond to my email. At 5 PM today, I received an email from Dempsey referring me to the State Rep’s website to read his position on school choice . . . Rep. Kampf’s “wait and see approach” (see below).

Kampf Praises Creative Solutions, Cautious on ‘School Choice’

3/11/2011
By Rep. Warren Kampf, 157th District

Competition is critical to the efficiency of any enterprise, whether it is businesses competing for consumers by becoming more cost-effective or schools improving their teaching methods to lure students. There is a place for competition in our education system.

But before we adopt any so-called “school choice” proposal, we must examine whether the new system costs the state and school districts more money or subsidizes inefficient private schools.

At this stage, I am taking a wait and see approach. As for Senate Bill 1, it is difficult to comment on a bill that will be significantly transformed by the time it reaches the House. As is the case with another “school choice” bill, House Bill 240, I expect the legislature to pass numerous amendments to alter its rules and scope, though in what way I cannot yet predict.

I will just restate my position that whatever new system is tried, it should be done in a way that improves the overall quality of our state education system, and does not drive up costs for taxpayers and already cash-strapped schools without some very clear, tangible benefits to all of our children.

I remain open to creative ideas for improving Pennsylvania’s public school system. I am aware that the system works well in some districts, and is more troubled in others. It is my goal to embrace what works and fix what needs improvement.

Identities of Suspected Child Molester Priests Now Public . . . Four Priests on the List are from Local Tredyffrin Parishes

March 10, 2011
24 Comments

This has not been a good week for some local Roman Catholic churches.

Twenty-one Philadelphia area priests received sex probe suspensions because of a grand jury report released in February. On the Philadelphia archdiocese suspension of priests, the New York Times (www.NYTimes.com ) is reporting, “The Mass suspension was the single-most sweeping in the history of the sexual-abuse scandal in the Roman Catholic Church in the United States.” The priests who have been suspended cannot celebrate Mass or hear confessions; they were only given a few hours to leave their parishes.

Unfortunately, the Philadelphia archdiocese was a bit ‘delayed’ in releasing the identities of the suspected child molester priests. The names are now public and it is my understanding the priests have been removed from ministry while their cases are reviewed.

National headlines have read ‘Philadelphia priests’ suspended so I did not expect to recognize any of the priests or parishes on the list. It is very disturbing to learn that four of the priests suspended for sexual abuse and inappropriate behavior with minors are from our local Main Line community:

  • Monsignor John A. Close of St. Catherine of Siena in Wayne, Pa.
  • Rev. Steven J. Harris of St. Issac Jogues Catholic Church in Wayne, Pa.
  • Rev. Daniel J. Hoy of Our Lady of the Assumption in Strafford, Pa.
  • Fr. Peter Talocci of St. Patrick’s in Malvern, Pa.

Remember the sexual abuse scandal in the Boston archdiocese in 2002. The Boston Globe coverage of the criminal prosecution of five priests gave national limelight to the child molester issue in the Roman Catholic Church. (The Globe won a Pulitzer Prize for their coverage). The newspaper’s front-page coverage of this issue encouraged other victims to come forward, which resulted in more lawsuits. The cost of legal defense for the Boston archdiocese was staggering. With the identities of the Philadelphia priests now known, we may see a similar situation to Boston with other victims coming forward with allegations of abuse.

It’s Official . . . Announcing Candidates for Tredyffrin Township Board of Supervisors & Tredyffrin-Easttown School Board!

March 9, 2011
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Tuesday, March 8th was the deadline to file petitions for Pennsylvania’s May 17, 2011 primary election.

Special thanks goes to Mike Broadhurst, chair of the Tredyffrin Township Republican Committee and Dariel Jamieson, chair of the Tredyffrin Township Democratic Committee for providing the names of candidates for the Board of Supervisors and the Tredyffrin Easttown School Board. Mike and Dariel have agreed to supply the bios and/or resumes of each of the supervisor and school director candidates which I will provide in a future post on Community Matters.

Note on School Director candidates: To become a school board candidate, you must file a petition signed by at least 10 qualified voters of the school district for the political party with which the petition will be filed. It is my understanding that all school board candidates are cross-filing. To cross-file in a primary election (that is, to run on both political parties), a registered Democrat or Republican must circulate a proper petition for the other party. The petition must contain signatures as previously mentioned. If elected on both party ballots in the May primary, a candidate will appear on both party ballots in the general election in November.

The candidates for the May 17, 2011 primary election are as follows:

The Tredyffrin Township Republican Committee has endorsed the following candidates for the office of Tredyffrin-Easttown School Director:

  • Region 1: James Bruce **
  • Region 1: Tara G. LaFiura
  • Region 2: Kristine Graham
  • Region 2: Elizabeth Mercogliano

The Tredyffrin Township Democratic Committee has endorsed the following candidates for the office of Tredyffrin-Easttown School Director:

  • Region 1: Karen Cruickshank **
  • Region 1: Jerry Henige
  • Region 2: Scott Dorsey
  • Region 2: Jenny Wessels

The Easttown Township Republican Committee has endorsed the following candidate for the office of Tredyffrin-Easttown School Director:

  • Easttown, Region 3: Peter Motel **

The Easttown Township Democratic Committee has endorsed the following candidate for the office of Tredyffrin-Easttown School Director:

  • Easttown, Region 3: No Candidate

For Tredyffrin Township Board of Supervisors, the Tredyffrin Township Republican Committee has endorsed the following candidates:

  • Supervisor at Large: Michael Heaberg **
  • Supervisor at Large: Kristen Kirk Mayock
  • District 1 East: Paul Olson **
  • District 3 West: John DiBuonaventuro **

For Tredyffrin Township Board of Supervisors, the Tredyffrin Township Democratic Committee has endorsed the following candidates:

  • Supervisor at Large: Molly Duffy
  • Supervisor at Large: Ernani (Ernie) Falcone
  • District 1 East: Victoria (Tory) Snyder
  • District 3 West: No Candidate

For Tredyffrin Township Auditor, the Tredyffrin Township Republican Committee has endorsed the following candidate:

  • Bryan Humbarger

For Tredyffrin Township Auditor, the Tredyffrin Township Democratic Committee has endorsed the following candidate:

  • No Candidate

For Chester County Magisterial District Judge, District Court 15-4-01, the Tredyffrin Township Republican Committee has endorsed the following candidate:

  • Jeremy Blackburn **

For Chester County Magisterial District Judge, District Court 15-4-01, the Tredyffrin Township Democratic Committee has endorsed the following candidate:

  • Analisa Sondergaard

** Incumbent

“Don’t Read my Lips; Read my Budget” . . . so said Gov. Corbett at today’s Budget Address

March 8, 2011
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Gov. Tom Corbett delivered his budget speech at midday to a joint assembly of the House and Senate, suggesting “Don’t read my lips; read my budget.” For a full text of his speech, click here:
http://www.scribd.com/doc/50290282/Corbett-Budget-Speech

In his opening remarks, Corbett’s presented an overview of his budget including “ . . The substance of this budget is built on four core principles: Fiscal discipline, limited government, free enterprise and reform. . . ” Corbett’s fiscal year 2011-12 budget totals $27.3 billion, but no new taxes.

There has been much discussion concerning the economic woes facing school districts across the state. In his budget address, the Governor supports letting the taxpayers decide . . .

” . . . Now, we all know that there’s an elephant in the room when it comes to education funding: The property tax. Too often we have seen school boards raise property taxes to avoid hard and necessary choices. It’s human nature. When you’re spending someone else’s money it’s easier to say yes than no. I believe any new property tax increases beyond inflation should be put on the ballot. If school boards can’t say no, maybe the taxpayers will. Let’s listen to the taxpayers on this one. . . “

The governor takes on the teacher unions with teacher furlough remarks,

” . . . At the same time we need to give school boards some breathing room. There are too many mandates that tie the hands of local school boards. This administration is committed to curbing these mandates, including one that violates every law of economics: the inability to furlough employees when there isn’t the money to pay them. It puts the entire enterprise of public education at risk. . . “

Specifically, how did the Department of Education fair in Corbett’s budget? A quick review indicates that education will receive an expected major cut in funding. The proposed cuts to education include a 10 percent cut in basic education (K-12), which is a loss of $550 million across the state. The budget also eliminates all $260 million in grants that are being given this year to school districts to invest in learning, including pre-K, full-day kindergarten and class-size reduction in kindergarten through third grade.

In his speech, Corbett asked public school officials to consider pay freezes; calculating that each year of this cost-saving measure would save school districts $400 million. Corbett said that he was returning the state education funding to the pre-stimulus funding level.

Addressing the state workers, unions, pensions and collective bargaining, Corbett’s approach was direct –

” . . . In Pennsylvania, we will be looking for salary roll backs and freezes from state employees as well as asking them to increase their contributions for healthcare benefits. We also need to start the conversation about the necessary repairs to our public retirement system.

I want to be clear about this to our union leaders. Collective bargaining doesn’t mean some ill-defined middle ground. It means finding the spot where things work. In this case it is going to have to work to the good of the taxpayer or it’s not going to work at all. Let’s find that place and meet there. Let’s keep things working. Neither side need lose for the taxpayers to win. We need to act on our financial challenges now, before they act on us. . . “

Although Corbett did not use the word, ‘voucher’ in his budget address, he was specific about his desire for school choice . . .

” . . . Pennsylvania needs to re-think how best to educate our children. We simply can’t work within a broken system. We need to change the whole system. We need a new set of priorities: child, parent, and teacher – and in that order. What we have now in too many places are schools that don’t work. Families are trapped in failing schools, or schools that are a bad fit. We need to develop a system of portable education funding; something a student can take with him or her to the school that best fits their needs. One size does not fit all. But as it now stands, not all get to choose. Let’s give them school choice. . . “

During his budget address, the Governor referred to the ‘Budget Dashboard’ available online. The dashboard is on the state website, is user-friendly and provides an easy access for information of individual state agencies. Here is a link to that reference:

http://www.portal.state.pa.us/imageserver/budget2011/GBD_2011.html

If you are interested, here is a link to the entire budget — all 1,182 pages. If you decide up upload the file, remember this is very large file and suggest patience.
http://www.scribd.com/doc/50277977/2011-12-Budget-Document

Corbett’s Budget, the Day of Reckoning . . . Who should be worried?

March 8, 2011
4 Comments

March 8, 2011 – the ‘Day of Reckoning’.

In a few short hours, Gov. Corbett will take center-stage with his much-anticipated 2011-12 budget. Government agencies across the state have every reason to be on edge, waiting for Corbett’s budget ax to swing this morning. Since Corbett promised not to raise taxes, this budget is expected to slash spending dramatically.

In the days leading up to today’s budget address, there has been much speculation met with few details from the Corbett administration. Facing a $4 billion state deficit, who should be most worried?

With federal stimulus money funding running out this year for education and health care assistance, those two areas are expected targets for major cuts.

Rumors are swirling that the governor’s budget contains $1 billion in education cuts. With many of school districts trying to manage looming deficits in next-years budgets, the severity of the anticipated state education cuts could send them over the edge. The loss of major educational spending from the state could have a direct impact on the taxpayers. If there is less education-directed funding coming from Harrisburg, will taxpayers be expected to pay higher property taxes to make up the difference? In some school districts in the state, we know the answer is ‘absolutely’.

Another probable target in today’s budget address is state workers. Of the 19 state employee unions in the state, contracts are expiring in June for 17 unions. Timing could not be worse for these union members . . . how many will lose their jobs due to budget cuts? One possible offset for state job loss, may be an increase in employee health care contributions. Will Corbett choose to push for substantial healthcare and pension contribution concessions from the union members?

A couple of other areas that may see major funding cuts are the state university system and the state parks. Colleges and universities are experiencing a decrease in aid as federal stimulus money diminishes. Combine the loss of federal aid with expected state budget cuts and college students in Pennsylvania may be facing higher tuition bills. Speculation has also swirled that the budget may contain significant funding cuts to the State Park system. Beyond diminished programming funding, it is possible that some of the parks will be forced to close.

March 8th, 2011, the ‘Day of Reckoning’ . . . as many feel the pain of Corbett’s budget. Tighten your seatbelt and brace for major cuts; the road is going to be rocky.

If Ardmore Transit Center can be built without a new Train Station, could Paoli Transportation Center suffer the same fate?

March 7, 2011
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Question for the Day: Where do you build a new transit center without building the new train station?

Answer: Apparently in Ardmore.

According to an article by Cheryl Allison in yesterday’s Main Line Times, the latest plan presented for the Ardmore Transit Center includes parking garage, luxury apartments, restaurants and retail shops but no new train station . . . at least not until there is additional public funding.

The Ardmore Transit Center developer, Carl Dranoff of Dranoff Properties presented his newest plan last week to a subcommittee of Lower Merion Board of Commissioners. Due to $35 million funding gap on the original transit center plan, Dranoff scaled back his Ardmore Station redevelopment project, and presented his new ‘phased’ approach, which calls for adding a new train station at a later date.

I thought that the impetus for the Ardmore Transit Center project was a new train station. The project received government funding based on that concept so how is it possible to exclude the train station in the initial phase. Dranoff thinks that with the addition of private funding to existing public money construction on this $60 million scaled-back phase could start by next year. The new plan calls for adding the train station when additional public funding becomes available in the future. I must be missing something, isn’t this the ‘cart before the horse’? Shouldn’t the project, the ‘transit’ project, start with the new train station ‘first’ and then add the other components to the train station instead of the other way around?

In addition to deleting a new train station in the initial phase of the Ardmore Transit Center project, the plan includes a dramatic reduction in parking, from 500 spaces to 270 spaces. We know availability of parking is a long-standing problem in Ardmore; will the reduced parking be adequate?

Do not get me wrong, I think that creating a new ‘Main Street’ development concept in Ardmore will revitalize the community and do much for the local business community. However, how do they rationalize the government money that has already been used in the development phase of the plan, if the project no longer includes the train station component? Dranoff’s new phased plan calls for a facelift to the existing Ardmore train station, but little else.

In the past, I have drawn comparisons between the proposed Ardmore Transit Center and the Paoli Transportation Center projects. Looking at Dranoff’s new phase approach to the proposed transit center, I for one would not be pleased if the Paoli Transportation Center took the same direction in its development.

A new train station needs to be the focal point of Paoli’s redevelopment plan; the starting point of the project. Parking, retail, restaurants and office buildings should all be part of the overall concept of the Paoli Transportation Center but as far as I am concerned, without a new train station, there should be no Paoli Transportation Center project.

Speaking of Paoli Transportation Center . . . where do we stand with that project?

Prior posts on Ardmore Transit Center & Paoli Transportation Center:

Septa pulls 10 million in financial assistance from Ardmore Train Station Project, what does this mean for Paoli Transportation Center?

Will Ardmore Transit Centers funding issues impact the future of Paoli Transportation Center?

A Penthouse View of Historic Market Street for Chester County Elected Officials . . . Rent $3.1Million per year

March 6, 2011
16 Comments

Based on Chester County’s recent lease negotiation with a private developer, no one would believe that we are facing the same economic challenges as the rest of the country.

The administrative offices of Chester County are moving from West Chester’s historic courthouse to a new privately owned 6-story office building on W. Market Street starting on March 18. Why the move . . . did they outgrow the courthouse office space . . . did they tire of their historic offices and long for the ‘new-car smell’ of new offices?

The county’s elected officials including commissioners, county controller, county treasurer, county solicitor, Recorder of Deeds will be leaving their courthouse offices behind for this new location. The lower 2 floors are parking for county employees and the upper four floors is office space in the new building. The Tax Assessment office will move to the third floor and the County commissioners and row officers will enjoy offices on the sixth floor, overlooking historic Market Street.

We do know the price tag for their new digs. The county is paying $3.1 million in rent for the first year; increasing by $31K each year for the length of the 20-year lease. The lease option is $37 million for the first 10 years. At that point, the county could purchase or extend the lease for the remaining 10 years. I am not sure how this lease agreement would work . . . the county will not own the building but will pay rent. I don’t see any economic or tax benefit to this arrangement. If the county needed more office space, why not either renovate existing county-owned space in the courthouse or use bond money to build an office building. At a minimum, the county would benefit from ‘owning’ rather than ‘renting’ their office space.

The county’s elected officials including commissioners, county controller, county treasurer, county solicitor, Recorder of Deeds will be leaving their courthouse offices behind for this new location. The lower 2 floors are parking for county employees and the upper four floors are offices in the new building. The Tax Assessment office will move to the third floor and the County commissioners will enjoy offices on the sixth floor, overlooking historic Market Street.

As an aside, I did some research on the property owner of the new office building . . . J. Loew & Associates, a commercial real estate developer from Downingtown. Based on the vast availability of office space listed on their website, J. Loew appears somewhat overextended with their available rental commercial real estate. In a quick analysis, I counted that the developer currently has over 30 office buildings, warehouse and retail complexes available for lease. In addition, some of the available office space is very large corporate office buildings in the Great Valley.

I guess a 20-year lease agreement with the county of $3.1+ million a year helped ease some of the pressure for J. Loew & Associates. Think about it, the company finances and builds the Market Street office building in West Chester, rents it to the county at a profit and [if the county decides at the end of 10 years] turns around and sells it to the county for a profit. Savvy business negotiating. Also when researching J. Loew & Associates, I discovered another interesting fact. The business partner of J. Loew & Associates, Eli Kahn, donated $25K to the Chester County Republican Committee over the last four years. All so very interesting.

Many of our Chester County officials were elected on campaign pledges of no tax increases and many of those individuals seeking election or re-election continue similar austerity promises. How will these same individuals now rationalize this lease agreement? Are taxpayers going to pay for our elected official’s penthouse view of historic Market Street?

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