Northborough,
Massachusetts
WORKING GROUP
Working Group
MEETING NOTICE
REGIONAL
SCHOOL DISTRICT AGREEMENT
WORKING
GROUP
February 21, 2001
AGENDA
Section
_______ :
Dissolution of the
Regional School District
(a)The District may be dissolved in accordance with the terms of either section
(b) or section (c), below.
Upon an affirmative vote(s) to dissolve the District in accordance with the terms of either section (b) or section (c), below, the following shall take place:
1)
the
Boards of Selectmen for Northborough and Southborough shall appoint a
Transition Committee consisting of seven members from each town;
2)
the
Transition Committee shall within 90 days prepare and submit to the
Boards of Selectmen a report, including a time line and a transition
flan for the dissolution of the District and for the creation of two
K‑12 school systems, one in Northborough and one in
Southborough;
3)
upon
approval of the time line and transition plan by both Boards of
Selectmen the Transition Committee shall implement the transition
plan;
4)
each
town shall remain liable for any operating costs incurred prior to the
affirmative vote(s) for dissolution and during the transition plan,
according to the existing terms of this Regional Agreement;
5)
each
town shall remain liable for its share of the indebtedness of the
District outstanding at the time of dissolution of the District,
according to the existing terms of this Regional Agreement;
6)
the
existing assets of the District shall be apportioned equitably between
the two towns; and,
7)
upon
completion of the transition plan the Transition Committee shall
present to the towns of Northborough and Southborough a warrant
articles) formally dissolving the District.
(b)
One member town of the district unilaterally may cause the
dissolution of the District provided that, within any twelve month
period, the member town:
( 1 ) by an affirmative
vote of at least 2/3 of the voters present, approve at an annual or
special town meeting a warrant article in favor of dissolution
according to the terms of this section, and
(2)
by an affirmative vote of at least 3/5 of voters casting
ballots, approve a ballot question in favor of dissolution according
to the terms of this section.
(c)
The two member towns of' the district may, through joint
action, cause the dissolution of the District provided that, within
any twelve month period, both member towns approve at annual or
special town meetings warrant articles in favor of dissolution
according to the terms of this section.
(d) No vote or other action by
the Committee shall be required under this section.
REGIONAL SCHOOL DISTRICT AGREEMENT
WORKING GROUP
MEETING
MINUTES
February
21, 2001
Regional
School District Agreement Working Group
Meeting
Minutes February 21, 2001
Members Present: David Coombs, Fred George, Dawn Rand, Elaine Kelly, Lynne
Winter,
Charles Millet, Karen Gadbois, and John Boiardi.
7:07 p.m. Co‑Chairman David Coombs convened the meeting.
After
summarizing the last meeting, there was discussion regarding
proposing an article on the Regional Agreement for the upcoming
Annual Meetings in both Towns. If an article is to be proposed it
would have to be decided by the middle of March and presented to the
Boards of Selectmen, Regional School Committee, the Regional
Building Study Planning Sub‑committee and the financial
committees for their consideration. The Working Group decided to
meet on Feb. 28 and March 7 to attempt to come to consensus on a
proposal. They will decide on March 7 if they will be ready to
propose an article at the town meetings.
The
minutes of Feb. 7, 2001 were amended as follows:
Second
paragraph should read as follows: Land:
It was agreed that under the section "Land", there
would be an appraisal of the land owned before the Metlife Land was
purchased and the purchase price of $700,000 would be assigned as
the value of the portion of the land previously owned by Metlife in
the short‑term.
Third
paragraph third to the last sentence should read as follows: In the
long‑term it was discussed that each town would hire a firm to
appraise the building.
Barry
Brenner, as requested, presented a draft (see attached) to address
the asset allocation defining the short‑term and in the
long‑term. There was discussion regarding the value of the
building having no value in the short‑term. Some working group
members feel strongly that the building has value in the
short‑term. Mr. Millett presented three methods of valuing the
building (see attached "What is Algonquin Regional
Worth?").
Lynne
Winter presented another draft of possible asset allocation (See
attached "Regional School District Agreement, Dissolution Asset
Allocation") This draft was an attempt to keep the process
flexible.
Members
of the working group raised issues with the appraisal process.
Should the .acceptable delta be 5% or 10 % between the two
appraisals? Some felt 5% was too small a percentage. If each town
picks an appraiser and the gap between the appraisals is too great,
who picks a third appraiser? If the school is torn down how do we
define each town's share of the cost of tearing it down?
There
then was discussion on what does the committee agree on and if the
committee can not vote, how do you define consensus. Mr. Boiardi
suggested that in his experience
consensus was defined by something that everyone can
live with. Is there consensus with the Marty Healey's document,
Lynne Winter's document or Barry
Brenner's document?
There seems to
be two issues that are difficult that are stumbling blocks: 1. Price
of building.
2.
Holding another town hostage in the event that the town wants
to leave the Region.
It was then suggested that we go back to the original
agreement. This was discussed and the following revised language was
proposed for Section V11 Dissolution of Regional, School District
of the Regional Agreement:
(a)
Either Town may petition to withdraw from the District under terms
stipulated in a plan presented by the proposing town provided (1)
that the town seeking to withdraw has paid over to the District any
operating costs for which it became liable as a member of the
District, and (2) that said town shall remain liable to the District
for its share of the indebtedness of the District outstanding at the
time of such withdrawal, and for interest thereon, to the same
extent and in the same manner as though the town had not withdrawn
from the District, except that such liability shall be reduced by
any amount which such town had paid over at the time of withdrawal
and which has been applied to the payment of such indebtedness or
interest.
(b)The
district shall be dissolved if the proposed plan is approved by both
towns by a majority vote at an annual or special town meetings and
thereafter by a majority ballot vote at an annual or special
election.
(c)
Money received by the District from the withdrawing town for payment
of funded indebtedness or interest thereon shall be used for this
purpose only.
The two issues that still need to be addressed in the
agreement are adjusting the language to just two towns (Berlin was
the third town included in the original agreement) and the voting
rights or the representation of each town on the Regional School
Committee.
Meeting adjourned at 8:50 p.m. Next meeting Feb. 28
in Northborough.
Janice C. Conlin
Town Administrator
A~/a
DRAFT
DEFINITIONS ‑ REGIONAL SCHOOL DISTRICT
AGREEMENT
DISSOLUTION
‑ ASSET ALLOCATION
SHORT TERM
"SHORT
TERM„ is defined as the time period prior to initiation of
construction for a new High School Facility or for
renovation/addition of the existing High School Facility.
LONG TERM
"LONG
TERM" is defined as the time period following initiation of
construction for a new High School Facility or for
renovation/addition of the existing High School Facility.
(d) Asset Allocation
In preparing the Asset Allocation Plan, the
Dissolution Transition Committee shall be guided by the following
parameters for valuing assets and then determining equitable
allocation of the assets:
(1) Land.
(a) During the "Short Term" the existing
High School Land exclusive of the MetLife Land will be appraised.
The MetLife Land will be valued at the purchase price of $700,000.
(b) During the "Long Term" all High School
Land will be appraised.
(2) Building.
(a) During the "Short Term" the existing
High School Building will be valued as having no value for asset
allocation.
During the "Short Term" any
repairs/maintenance to the existing High School Facility shall be
considered as consistent with the existing High School facility
having no value for asset allocation.
1 DRAFT
DRAFT
(b)
During the "Long Term" the new High School Facility or a
renovated/added to Facility shall be considered as having value and
appraised for valuation purposes for asset allocation.
(3)
Fixed Assets.
(a)
During the "Short Term" fixed assets will be inventoried
and valued.
(b)
During the "Long Term" fixed assets will be inventoried
and valued.
DRAFT
WHAT
IS ALGONQUIN REGIONAL WORTH?
SOURCE
NESDEC REPORT AND SOME OF MY OWN ESTIMATES
SCENARIO
I
BUILDING / RENOVATION OPTIONS
OPTION 3N.1 Renovate High School ‑
Northborough Only
New Construction: Cost before State Reimbursement
$22,567,000
On‑Site Sewage Treatment Plant ‑ Cost before
State Reimbursement
1,111,000
$23,678,000
OPTION
3N.2 New High School ‑ Northborough Only
New Constriction: Cost before State Reimbursement
$28,946,000
On‑Site Sewage Treatment Plant ‑ Cost before
State Reimbursement
389,000
$29,335,000
Difference
between new and renovate represents estimated value of present
school building
$5,657,000
Building
Contents ????
Land
Value Cost Per
#
Acre
Acres
Total
Estimated
Real Estate value of existing land (from below)
$100,000
42.9
$4,290,000
Estimated
Real Estate value of new land (Based
on recent Purchase Price)
700,000
Estimated
increase in value of new land ?????
Total
estimated value of land
$4,990,000
GRAND
TOTAL
$10,647,000
ESTIMATED
FOR PRESENTATION PURPOSES ONLY
67.00%
Northborough Share $7,133,490
33.00%
Southborough Share $3,513,510
What
is Algonquin Worth
Page l of 3
SCENARIO
II
Page
21 of NESDEC Study
CAPITAL
ASSETS ALLOCATION
B. Estimated Land Sale Price
The
Algonquin Regional Agreement contains a section on Dissolution of
the District (Section VII) which includes procedures for
reallocating bonded indebtedness, current operating cast
liabilities, voting procedures and the quantum vote necessary at the
Regional Committee and Town Meeting levels. The Agreement is silent
on the matter of disposition of the capital assets (building,
furnishings, land ) of the District. Furthermore, it appears to
NESDEC, that the language of Section VII was drafted in
contemplation of a three town region and when Berlin failed to join,
the language was not revised.
It
is our understanding that in the absence of a mechanism for one town
buying out the capital assets of another in the regional district,
either an amendment to the Regional Agreement setting forth the
basis thereof or an act of the Legislature to clarify this matter
would be necessary.
1n
the absence of a formula in the Agreement, NESDEC would suggest the
following:
a)
A special ad hoc committee be appointed to develop a
Capital‑Asset Allocation Plan that would establish the fair
share of each town's interests in the land, building, contents of
the Algonquin Regional High School. A current appraisal of the
building value, a current assessment of the depreciated inventory of
the building's furnishings and equipment, and an appraisal of the
current land value is beyond the scope of this study and should be
done by appraisal specialists. Indeed, the District may wish to
secure two independent appraisals and seek a third if there is a
significant difference between the two... if there be
a
serious intent to dissolve the District.
b.)
A very preliminary, "rough‑cut" analysis might be
the following:
A.
Deland Gibson Insurance Association (Incomplete)
10/1/92
Statement of Value Algonquin Regional High School
(building
& furnishings)
$23,500,000
B.
42.9 acres at $100k/acre (estimated cost reed on buildable land in
Northborough) 4,290,000
New land
700,000
Increase in value of new land ????????
Total $28,490,000
ESTIMATED
FOR PRESENTATION PURPOSES ONLY
67.00%
Northborough Share $19,088,300
33.00°/.
Southborough Share $9,401,700
Again,
this data would need to be updated and verified
What
is Algonquin Worth
Page 2 of 3
SCENARIO
III
c)
Commercial Sale of the School ‑ Numbers based on NESDEC Study
Another approach would be to put the school on the open market for
resale as commercial property. A detailed appraisal of the value of
the property would need to be made as well as a determination as to
whether the zoning of the property could be changed (both of these
considerations are beyond the scope of this study)
Cost Per
#
Sq.Ft Sq.
Ft. Total
A.
Estimated Building Sale Price (Does not include contents)
$40.00 210,000
$8,400,000
Estimated value of contents ???????????
Possible Commercial Sale Price of Building /
Contents
$8,400,000
Cost Per
#
Acre Acres
Total
B.
Estimated Land Sale Price $100,000
42.9 $4,290,000
Add in new land (Original Purchase Price)
700,000
Increased value of crew land ???????????
Possible Commercial Sale Price of Land
$4,990,000
Possible Commercial Sale Price of Land,
Building & Contents
$13,390,000
ESTIMATED
FOR PRESENTATION PURPOSES ONLY
67.00°/.
Northborough Share $8,971,300
33.00'/.
Southborough Share $4,418,700
SUMMARY
SCENARIO 1
67.00% Northborough Share
$7,133,490
33.00% Southborough Share
$3,513,510
TOTAL
$10,647,000
Includes
furnishings
SCENARIO II
67.00% Northborough Share
$19,088,300
33.00°/. Southborough Share
$9,401,700
TOTAL
$28,490,000
SCENARIO III
67.00•/. Northborough Share
$8,971,300
33.00%
Southborough Share
$4,418,700
TOTAL
$13,390,000
What
is Algonquin Worth
Page 3 of 3
L.
Winter 2/21/01
DRAFT
ii
REGIONAL SCHOOL DISTRICT
DISSOLUTION ASSET
In
preparing the Asset Allocation Plan, the Dissolution Transition
Committee shall be guided by sections (1) and (2) for valuing assets
of the Regional School District. However, if one or both member towns
determine that the process outlined in sections (1) and (2) is not
appropriate for any reason including but not limited to the age and
condition of the assets, section (3) below shall apply. Such
determination shall be evidenced by a vote of the board of selectman
of the member town(s).
(1) Land & Building (s)
The
value of all land and buildings owned by the Regional School District
shall be appraised. Each member town shall select an appraiser to give
an opinion of value. If the appraisals differ by less than 5%, then
the average of the two values shall be used as the total value. If the
values differ
by 5%
or
greater then a third appraisal may be obtained upon mutual agreement
by the member towns. If the towns do not agree to obtain a third
appraisal the value shall be based upon a mutually agreed upon amount
negotiated by the member towns as outlined in section (3) below.
(2) Fixed Assets and Major Movable went
An inventory of all fixed assets and major movable
equipment owned by the Regional School District shall be determined.
Assets may be allocated to one or both of the member towns or disposed
of through sale, salvage, or otherwise.
(3)
Negotiation Process
Upon the determination that the methodology
outlined in sections (1) and (2) shall not
apply
as indicated by a vote of the board of selectman in one or both member
towns,
the board of selectman in each member town
shall appoint a negotiation team within
34 days of such vote. Each team shall have no
more than three active members in
direct discussions with the other negotiation
team. Each negotiation team shall
determine and declare its manner of
conducting the negotiation, whether through a
designated spokesperson, by majority vote, by
unanimous action or otherwise. The
teams shall attempt to negotiate the asset
allocation plan for no more than _ months
upon initiation of the dissolution process
pursuant to section , (a) or (b). Upon
reaching agreement, the negotiation teams
shall deliver the plan to the board of
selectman in each town to be included as part
of the overall transition plan to be