THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Sunday, April 16, 1995 TAG: 9504160086
SECTION: LOCAL PAGE: B1 EDITION: FINAL
SOURCE: BY KAREN WEINTRAUB, STAFF WRITER
DATELINE: VIRGINIA BEACH LENGTH: Long : 118 lines
In the last 21 months, the school district has spent more than half a million dollars renting space it doesn't use.
And now it wants to buy and expand the building for a program not yet approved by the school board.
The district's involvement in the building on Virginia Beach Boulevard has left the City Council with a host of questions.
School Superintendent Sidney L. Faucette told the city manager and council he needs the Celebration Station building because three years ago, the city made him give up office space elsewhere. He wants to buy it to make room for a new school, a magnet school, for academically talented children.
In an April 7 letter to the superintendent, City Manager James K. Spore questioned Faucette's logic. Spore's budget for next year does not provide funding for most new programs, including the magnet school.
The City Council called a meeting with the School Board for Tuesday to try to get some answers on Celebration Station.
What is clear is that the district is spending nearly a $1 million a year to rent a building that's 129,000 square feet, about the size of three football fields.
The shopping-mall-turned-education-complex sits opposite the new Home Quarters Warehouse store, a quarter-mile from the Rosemont intersection.
Right now, 60 percent of it - more than 1 1/2 football fields - sits empty.
Faucette said he needs the space at Celebration Station to enact his plans. To purchase, renovate and expand the building would cost more than $15 million, money that would have to come from the city, which finances the school system.
``Celebration Station is a real critical item to us,'' Faucette said at an April 5 news conference he called to discuss the city manager's budget recommendations.
Blocking the project ``guts the future of what we had promised to our gifted and talented advisory committee.''
Spore and Faucette have quarreled over this project and several others during the budget process, which annually pits the city's bottom line against the school district's wish list.
``I just felt that the $16 million, which is the eventual cost of the project, seemed to be excessive,'' Spore said Friday.
The school district's move into the echoing emptiness of a former mall began three years ago when officials decided to move out of Courthouse Elementary School.
Since then, the school district has spent well over $1.5 million to rent Celebration Station, and another $950,000 to renovate it, city and school records show.
Faucette said the district needed to compensate for the space lost at Courthouse Elementary and to alleviate overcrowding problems.
In a letter to Faucette two days after the news conference, Spore bristled at the superintendent's accusation that the city had created the problem.
``Since the facility, at the time of these relocations, was not being used for classroom purposes, how did the relocation contribute to alleged student crowding problems?'' Spore wrote.
The timing of the lease also appears to contradict the connection Faucette makes between Celebration Station and the relocation of offices from Courthouse Elementary.
The district leased 32,000 square feet of Celebration Station in August 1992, shortly before agreeing to vacate Courthouse Elementary and more than a year before moving its offices out of the former school.
In June 1993, the district leased an additional 100,000 square feet of Celebration Station, although it only lost 18,000 square feet of office space at the elementary school, according to school and city records.
No one from the school district who could be reached late last week, during a school holiday, could explain the timing gap or the need for so much additional space. There is no direct reference to the original lease or the expansion in the school board's minutes or in its annual budgets.
Several current and former school board members said they did not remember if there was another reason for leasing Celebration Station besides replacing the Courthouse Elementary School space.
Spore and several city council members said they also were concerned about the building's escalating rent and high purchase price.
The district paid more than $700,000 in rent last year and expects to pay more than $900,000 in the next fiscal year to lease the building's 129,000 square feet.
Mordecai L. Smith, the schools' chief financial officer, could not explain why rent was increasing so dramatically but said those increases mean it's in the city's best interest to buy the building.
``One of the reasons I was a proponent for acquiring the facility was because there were some costs that I felt were escalating with no justification,'' Smith said Friday.
Smith said the purchase would cost $6.85 million, the price negotiated with Virginia Beach real estate giant Gerald Divaris, who manages the building for a group of Pennsylvania investors.
City officials have also raised questions about the $8.4 million the district requested to renovate and expand the building.
The School Board's budget does not reflect Faucette's urgency to purchase and renovate the building.
In its demands for next year, the school board considered the Celebration Station renovation and expansion as its only level ``C'' priority, following a long list of needs categorized as ``A'' or ``B.''
Smith said the purchase, which does not appear on the board's list, is of higher priority than the renovations. He also said the proposed expansion could probably be scaled back.
Even the location of the building has been a point of contention between the council and the school district.
School Board Chairwoman June T. Kernutt said Saturday that the building's central location makes it the perfect spot for administrative offices and a magnet school.
But several council members have said that the property's location makes it perfect for a money-making operation, not a school. If the district bought the building, the city would lose at least $50,000 a year in real estate tax revenue.
Several council members and City Manager Spore said there might be a better way to give the school district what it needs than buying or leasing Celebration Station.
``We need to sit down and review those costs and see if there are any other options out there that are more cost effective,'' Spore said. by CNB