Former city school put on the market

SOUTH PORTLAND — The South Portland City Council has agreed to contract with a commercial real estate broker to sell the former Roosevelt Elementary School at 317 Pine St.

The three-story brick building dates to 1927, but had been leased to Spurwink Services, a provider of mental health and special education services, since 1985. In July, Spurwink announced it would end its K-10 program in South Portland due to declining enrollment and consolidate services in an expanded location at the Cummings School in Portland. The program was down to just 22 students when discontinued around the Labor Day weekend.

Although responsible for the building, including security systems and winter heat to 50 degrees through the expiration of a one-year, early lease-termination notice to July 1, 2013, Spurwink has said it will have the last of its equipment and furnishings out of the building by Nov. 30. The city will take care of plowing an “emergency strip” to maintain access to the building during the winter.

The council decided to sell the building at a workshop on Nov. 14, when City Manager Jim Gailey indicated it’s too far off the beaten path to be redeveloped as a new City Hall.

“Parks and recreation saw the possibility of creating some programming there, but I think that might be a duplication of service with the Boys [& Girls] Club just down the street,” said Gailey. “No one else has come forward, from staff or the schools, saying the city should retain this.”

Although the city will not officially take back the building for seven months, Gailey said he did not want to wait that long to settle its ultimate fate.

“I want to know where I’m going with this building well in advance of next winter,” he said.

Councilors present at the workshop unanimously favored selling the building over trying to re-lease the property.

“We’ve seen it again and again, we are not really good at being a landlord,” said Councilor Tom Coward. “We never really make any money on these deals. Plus, eventually, it’s going to need major work and we’re never going to have enough money from the lease.”

“It’s nice to keep all your old toys you don’t play with anymore – and I like the building, I think it’s one of the most beautiful buildings we have – but my inclination is to look at selling it,” agreed Councilor Maxine Beecher.

The building is in the “Residential – A” zone, meaning it could not be turned into apartment buildings. Condominium units would be allowed, but limited by zoning to four units per acre, meaning seven units given the school’s 1.74-acre lot.

“I think there would be a good potential for selling it,” said Coward, who works as a real estate attorney, noting that his firm recently sold a unit in the former St. Patrick’s School in Portland, now The Landmark on Whitney.

“I think the limiting thing here is whether you could get enough units in there to make it worth somebody’s while to do, which means we would have to smooth the way as much as we can,” he added, suggesting allowances on top of a contract zoning amendment.

“The less somebody has to spend on municipal approval, the more they’ll pay us to take it off our hands,” he said. “At any rate, it’d get it off our hands and on the tax rolls.”

The property is assessed at $738,300. According to Greg L’Heureux, the city finance director, Spurwink got to write off the annual depreciation of improvements from its lease, which was set at what taxes on the 13,000-square-foot building would be if privately held. Given the tax rate of $16.10 per $1,000 of valuation, the lease would have been $11,887 this year.

According to L’Heureux, the write-offs have made the lease “effectively zero for many years now,” although the agency has paid routine maintenance and upkeep out of pocket. Major improvements through the years include a new roof, new windows, landscaping, installation of an elevator and piping of bathrooms to each classroom.

L’Heureux could not be reached for comment Monday, but there are indications that Spurwink would have continued to ride on the depreciation of its improvements through the expiration of its 20-year lease on the building, to 2016. In fact, based on amortization schedules, the city may actually owe money to Spurwink, although the agency is not holding the city to a strict reading of the lease.

“Spurwink is not asking the city for or anticipating and reimbursement from the city for its improvements not fully depreciated,” wrote the agency’s vice president of operations, Daniel Bonner, in a Nov. 6 letter to Gailey.

Given presence of the elevator Spurwink installed, Gailey said the building, built in 1927, “has great marketability.” Although the 1980s-era windows Spurwink put in need to be replaced – the seals have busted, allowing moisture to seep between panes of glass, Gailey said – and the once-spacious classrooms have been carved into smaller spaces, the building itself is in “great shape.”

“It’s very solid, from the inside and the outside,” said Gailey. “I was very impressed with the condition when I toured it two weeks ago.

“There’s still a lot of character in that building,” said Gailey, noting that he had attended classes in the building when it was still a public grade school.

According to Sonia Garcia, Spurwink’s director of clinical business development and marketing, the Roosevelt school was instrumental to the agency’s success in its early years.

“The Roosevelt School is of historical significance to Spurwink,” she said. “The Roosevelt program laid the ground work for the development of an effective day treatment model for young children with pervasive developmental disorders, including children on the autism spectrum.”

The same year Spurwink opened at Roosevelt, it won recognition from the National Institute of Mental Health as one of 11 “exemplary programs” across the nation. But Garcia says enrollment has been on the decline in recent years.

Some of Roosevelt’s 30 staffers did lose their jobs in the consolidation, said Garcia, though she declined to say how many.

According to Garcia, enrollment at Roosevelt was off more than 50 percent from its high. Most of the loss, she theorized, is due to public schools putting a greater emphasis on special education in recent years.

“Public schools have really been sharpening their saws and really finding ways of assisting kids with special needs. So, that could be part of lower enrollment.”

South Portland Superintendent Suzanne Godin says there are 523 individuals in her district receiving special services for at least one identifiable, primary disability. That’s about 17 percent of total enrollment in South Portland.

Treatment for autism, long one of Spurwink’s specialties, has seen an especially rapid growth, up from fewer than 10 students eight years ago, when Godin took the top job in South Portland schools, to 61 today.

“Honestly, we really don’t know what’s driving that,” said Godin, at a recent school board retreat.

Spurwink still has plenty on its plate. Founded in 1960 with just eight special needs boys, the agency now serves more than 5,000 clients – including children and adults with a range of mental health issues – in 20 homes and six special education schools for children age five to 21. It boasts 900 employees,

“In the past few months we’ve been really focusing on a consolidation strategy,” said Garcia. “It’s hard to run all of these schools and so closing this school and moving the children to Cummings just really made good sense.”