Burdens and Costs Pile Up for School Board’s Ex-ITT Building on Corporate Drive, Disrupting Community Education
FlaglerLive | November 13, 2013
Hard to imagine that at one time the lumpish, 52,000 square-foot building on Corporate Drive, off Palm Coast Parkway, was the symbol and crown jewel of ITT’s enormous imprint on Palm Coast. The development company’s local headquarters had gone up in 1977, in what was then a sprawl of pines, and from there ITT oversaw the rapid development of what it envisioned as an eventual mega-subdivision of 250,000 people.
Just 20 years later ITT vacated the building, selling it to Robert Szymanski, a Palm Coast resident who also owned St. Joe Plaza until 2007, and still owns a local marketing company. The selling price: $1.1 million. Five years later, Szymanski sold the building to the Flagler County School Board for $3.5 million, realizing a cool 218 percent profit.For the district, the deal has proved more burdensome than salutary. The school board quickly dispensed with the notion of moving its main offices there, though the idea had been batted around as a selling point before the expensive transaction. But parking and the building’s odd structure would have been an issue. It became the home of the district’s community education programs, now known as the Flagler Technical Institute, or FTI.
Community education is set up as a separate enterprise under the school board’s umbrella. It’s designed to be like a business, paying its own way through grants and student fees. Until the 2008-09 school year, the community education operation did just that. But like so much else in the county, the soured economy and a loss of grant funding hurt the operation, which has had to be subsidized by school board dollars since.
Last year, the district had to pay almost half a million dollars to service the debt on the Corporate Drive building, even as the district has been struggling year after year to make ends meet.
Last week the school board got even more bad news. The building is now little short of a ruin that must either be demolished or significantly repaired at costs starting at $1.7 million. That’s just for exterior renovations. Those costs climb by an additional $3 million for interior renovations.
“It looks like it would be cheaper to tear it down and build another building at some point in time, that would more closely meet our needs,” says Mike Judd, the district’s facilities director.
The third floor has already been evacuated: a lack of emergency exits required that use of the building be limited to the first and second floors. The clock on that occupancy is ticking. FTI have to move out, along with the daytime classes it offers there to hundreds of students. When the board meets next week, it will have to decide whether to move FTI by January or, as Judd will propose as an additional option, let FTI stay there through spring and make the move in summer. “There are issues with the building, but the structure itself is sound,” Judd said. “Right now the direction we got from the board is that we’re going to move them in January.”
Think of it as the school district’s slightly more useful version of the old Memorial Hospital in Bunnell that the county just bought for $1.23 million. (The Corporate Plaza building and the old Memorial Hospital have this in common: Michael Chiumento III, the local attorney, was one of the three owners of the hospital, and he was, in 2001, the school board attorney who brokered the deal with Szymanski on Corporate Plaza).
And as with the hospital, Corporate Plaza had its own building evaluation just completed (by D.J. Design Services of Holly Hill), which makes for depressing reading: Everything from exterior walls to the roof to flashing has to be replaced, window sills have to be redesigned, elevators rebuilt, and such things as doors and doorways have to be made compliant with code, among several other safety issues. The list of recommendations is long. The school board’s decision will be difficult.
The board has several options, as Judd laid them out during a meeting on the matter last week. The place could simply be mothballed for now. But that means the district will be servicing the building’s debt, which doesn’t fully mature for years, for nothing in return. The building could be demolished and the land kept ready for a new project at some point. It’s not as expensive to demolish, and the district could assume that cost now. But that still leaves the district making payments for nothing in return. The district could pay for the $1.7 million in basic repairs, but that won’t make the interior of the building usable without the additional $3 million in renovations.
The board doesn’t have that kind of money, either in its capital funds or in its reserves, at least not to the extent that it could risk using it on the Corporate Plaza building: the district has needed its reserves for more critical needs in recent years. One additional option is to float bonds, raise the needed money, demolish the structure and build one that would suit the needs of the district, Judd says. The bonds don’t have to be approved by referendum: the board can approve the approach on its own. But more bonds means more debt, even as the board is paying on the building’s old debt. That option, too, is not a palatable one, and the public may still recoil at the notion of bonds being floated without its approval.
For all that, FTI isn’t going anywhere, except physically. The district has enough space to parcel out the community education classes between FTI’s facilities at the Belle Terre Swim and Racquet Club, at a facility on State Road A1A, in three portable classrooms, and in classrooms in existing schools, which are used in after-hour classes. Some classrooms could potentially be used during regular school hours, Judd said, with some segregation between adult-education programs and schoolchildren.
FTI’s programs may be facing some changes too: by losing grants and having its revenue reduced, the program can’t offer as many classes as it had in the past, unless it finds a way to raise revenue again. So its offerings may change. “But it won’t be due to the building,” Judd said.