Foster Swift School Law News
July 20, 2016
In recent years, declining enrollments, shrinking budgets, and changing technological needs have led many Michigan school districts to consolidate instruction and administration into fewer of their facilities. This has left school boards and administrators with the unenviable task of determining what to do with school properties no longer being used.
In many cases, students and faculty are consolidated into the district's newer facilities. As a result, the school buildings left vacant tend to be older structures, many dating back as far back as the first half of the twentieth century. The condition of such buildings can pose significant challenges to their potential re-use. They may require substantial renovations and upgrades to meet twenty-first century demands. In addition, because of their age, these facilities may raise environmental concerns, such as the presence of asbestos, lead paint, and underground tanks. Finding the funds to address and resolve such issues is always difficult, but especially so when it was financial limitations that caused the district to vacate the building in the first place.
One option that may appeal to a school district is the demolition of a building no longer in use, to free the underlying land for new development. Among other things, this will require contracting with a demolition company, and likely also an environmental analyst – and, if environmental hazards are found, a certified removal contractor. Demolition will, of course, also necessitate dealing with governmental building authorities.
In addition, school boards and administrators considering demolition will want to take other considerations into account. As with any other very public action that it takes, a school district should consider the potential reaction of the community to the proposed demolition of a school building, especially a longstanding one. District leaders will also want to be aware of any pending legislation that limits the option of demolition, as has been proposed in the Michigan legislature in recent years. Furthermore, the long-range need for the facility should be carefully considered. Milwaukee Public Schools is a cautionary tale: there, increasing enrollments in the 1990s caused problems for, and drew criticism of, the school system which had demolished 29 schools in the preceding decades.
An alternative option for the school district is to take steps to maintain the property as a public facility. Perhaps with the Milwaukee example in mind, the school board may determine to "mothball" the closed facility and preserve it for the district's own use. This would require arranging for a basic level of maintenance and inspection of the building and its grounds, along with security services to prevent trespassing or vandalism. Alternately, by entering into an arrangement with another public entity, the district may find a current public use for the facility other than as a school. One example is Hannah Middle School in East Lansing, which the City acquired from the school district and converted into a community center offering social services, performing arts spaces, fitness facilities, and offices and meeting rooms.
A number of Michigan school districts have taken advantage of a third option: selling a facility to private parties. Some former school properties have been sold to for-profit developers who have transformed them into condominiums, like the conversion of an old high school in Grand Rapids into Union Square Condos. In St. Joseph, Washington School was purchased and used as an office building by the Whirlpool Corporation, before selling it to Berrien County for its administration center. Elsewhere, non-profits have acquired closed facilities and adapted them into senior housing, as with the conversions of Ypsilanti High School and E.E. Fell Junior High School in Holland.
However, selling a facility does pose several challenges to school boards and administrators. Before offering and conveying a public asset like a school building, the district will need a careful appraisal of the property to determine its fair market value. Moreover, a well-crafted purchase agreement will be needed to protect the district from liabilities and responsibilities related to the facility that it does not want to continue to bear.
A school district that finds itself with a vacant facility has important decisions to make: not only what to do with the property, but how to go about achieving its desired ends. School boards and administrators should consult experienced legal counsel to help guide them through such critical decision making and implementation.