Old school sale: $2.5M
AUSTINTOWN – A sales agreement to sell a former Austintown school building and property for $2.5 million was approved by the Board of Education.
The buyer, LRC Development Co. LLC, may intend to use the former Fitch / Austintown Middle School property for future retail use, Austintown Supervisor of Operations and Facilities Mal Culp said.
He added that he believes it is the company’s intention to demolish the 97-year-old building.
“We feel it is in the best interest of our school district, our community and our tenants,” board President David Schnurrenberger said Wednesday of the agreement.
The facility, which opened in 1916, served as Fitch High School until 1968; it then became Austintown Middle School until the building was closed in 2007.
The 15-acre property was appraised in 2010. The board then established a minimum selling price of $2 million as-is.
“(The sale) has been in the works for years, and at times required the board’s full attention,” Schnurrenberger said.
A public auction was held in 2010 which generated substantial interest, Culp said, but the offers fell short of the minimum selling price.
The resolution to accept LRC Development’s agreement was passed unanimously by the board last week after several months of negotiations between the company, the school board and another bidder.
“I am very pleased” with LRC Development’s offer, Culp said.
“It is very important to emphasize at this point that the proceeds from this sale will not be available for the general fund and can only be used for capital improvements,” Culp said.
Superintendent Vincent Colaluca explained that it is a common misnomer for some to consider the revenue from the sale as additional money for district operations.
“It’s actually very clear in state law that the money can’t be used for anything but capital improvements,” things that will last more than five years, he said. “It looks like the district is receiving a lot of money, but it is not to be used to operate the schools.”
After the agreement is signed, the district will receive a $25,000 deposit and a 180-day due diligence period will begin to allow the purchaser to acquire the necessary permits, zoning and inspections as well as contract a primary resident for the property.
Once the due diligence period has passed, the sale can be completed and the final payment will occur.
Board member Harold Porter pointed out that there is still time for the purchaser to walk away from the sale.
“They have six months to get an anchor store. This is not sold at this point,” he said, adding that LRC Development will only be out $5,000 if the sale falls through.
“We still have to maintain it, we still have to cut the grass, we still have to keep insurance on it, we still have to keep the security system on,” he said.
However, Porter said he voted yes on the agreement because he believes it’s the best option the district has at this point.
“It’s worth taking a chance,” he said.