Schools
School Board President Explains Delay In Millikin School Deal
The delay is because Mosdos Ohr Hatorah wishes to re-negotiate the agreed terms, said CH-UH School Board President Ron Register.
The Cleveland Heights - University Heights School Board reached a deal with Mosdos Ohr Hatorah in August 2012 to lease them the vacant school for $1 per year for 30 years. Mosdos would be required to invest $1.5 million into the building during the first three years of the lease.
Register released a statement on the status of the project after Cleveland Heights City Council members said they were frustrated that a deal had not yet been finalized. Council members offered in late June to help facilitiate a deal.
Register said that Mosdos received construction cost estimates of $3.4 million, higher than they anticipated. As a result, Mosdos is seeking to re-negotiate the terms of the deal.
Register said the district has received the new proposed terms from Mosdos and officials are reviewing them now.
Millikin was closed in 2006 because of low enrollment. Since the closing, the city and school district have been searching for a buyer or a tenant.
Mosdos offered to purchase the building in 2011 for $550,000, but district officials said that price was too low. They said the building had been appraised for $2.3 million.
There was a proposal for a call center to move in as well, but that was rejected after resident pushback.
Read Register's full statement:
It’s unfortunate that it is taking so long to solidify our agreement with Mosdos Ohr Hatorah.
After many years of sometimes difficult negotiations about this property, we thought that we had found a price with which Mosdos could agree: $1 per year for 30 years. Both sides agreed to these preliminary terms and in August, 2012, the Board and Mosdos signed a non-binding lease proposal for Mosdos to lease the building. The proposed lease would have required Mosdos to invest $1.5 million in permanent improvements to the building during the first three years of the lease. After thirty years, Mosdos would have two consecutive options to renew for 10 year terms.
This would meet the needs of Mosdos, keep the property in educational use, and ensure a continued community-benefit for use of the facility.
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In October 2012, the Board’s legal counsel requested that Mosdos confirm that the cost estimates and work scopes that Mosdos received for its planned improvements to the building were acceptable to Mosdos and that Mosdos was willing to proceed with the lease and the improvements.
After not hearing from Mosdos for several months, the Board’s counsel asked Mosdos for an update. In March of 2013, we were notified by Mosdos that a construction cost estimate by its contractor was $3.4 million, apparently greater than Mosdos had anticipated but consistent with estimates that the District had received for renovation of the building.
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We’ve now been informed that Mosdos would like to change the terms originally agreed upon. We have asked what the new terms would be and are now reviewing the new terms presented by Mosdos’ counsel.
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