No deal on price for new elementary school site at court-ordered
mediation hearing; two sides remain millions apart
Gilroy – A land dispute between the school district and one of Gilroy’s oldest families will head to court later this month unless the two sides agree on a last-minute land swap.
The Glen Loma Group, which represents more than 100 members of the Filice family, and Gilroy Unified School District both made significant multi-million dollar moves on their offers for nearly nine acres during a Wednesday pre-trial settlement conference.
GUSD, which has already obtained legal possession of the land from Glen Loma and has started building an elementary school on the site in southwest Gilroy, upped the ante from $4.1 million to $7.1 million; Glen Loma brought down its asking price from $14.4 million to $10.5 million, according to attorneys for both sides.
The failure to agree means both sides will head to a Nov. 29 jury trial, unless the developers convince school officials to hand over a nearby 12.8-acre parcel.
“It would be an attempt to get like for like land instead of the $10 million,” said Norm Matteoni, an attorney for Glen Loma. “That has some complications for the school district, but that’s what we agreed to look at, rather than argue over the difference between the two positions.”
The alternative site, known as the Grove because it contains an outcrop of Eucalyptus trees near the corner of Miller Avenue and Santa Teresa Boulevard, lies at the edge of a 360-acre, 1,700-home development Glen Loma will build in southwest Gilroy over the next decade. It is not the first time the development group representing the Filice family and the school district discussed the idea of swapping the Grove for the school site.
The idea first came up in April 2005, said GUSD Assistant Superintendent Steve Brinkman, though he refused to explain why the idea never materialized.
He seemed skeptical it would work this time around because of its potential effect on the school district’s ability to obtain state reimbursements for the land purchase. In the case of the current site, the state will reimburse GUSD for whatever portion it must pay for the land, beyond the $3.75 million it already paid as a so-called condemnation price. For instance, if a jury set a price of $7.75 million, the school district could receive $2 million back from the state. In the case of a land swap, the school would divest itself of a valuable piece of land with no comparable return from the state.
“We’ve got to have a separate value that stands on its own,” Brinkman said, explaining that the state will not provide reimbursements on projected land values as part of a swap.
The legal battle over the land is the latest headache for the cash-strapped school district, which is facing a $12 million shortfall in funding for a new high school in northwest Gilroy. Every extra dollar the district has to spend to acquire the elementary school land is a dollar less it will have for the high school, Brinkman said.
The legal squabbling has not earned the Filice family new admirers. In a letter to the editor published Thursday, a Dispatch reader said the family “deserves a giant G, not for Great, but for GREEDY.”
“I can’t believe the audacity of the Filice family,” Chris Walling wrote, “to ask the cash-strapped Gilroy Unified School District for almost five times the amount they purchased the same land from the district three years ago.”
District officials sold the land to Glen Loma in 2002, based on long-term plans to rehabilitate an elementary school in north Gilroy. Just three years later, GUSD decided that it made more sense to build an elementary school in southwest Gilroy: The price of redeveloping a school was prohibitive and the southwest clearly was going to need a new elementary school to serve the homes built by Glen Loma.
By that point, the Filice family had polished plans to transform the rolling hills along Santa Teresa Boulevard into a miniature city, complete with a fire station, public parks and two schools.
A mark-up in land price was to be expected, City Councilman Craig Gartman said, though he agreed with sentiments that $14.4 million is excessive. The school district could have avoided the situation, Gartman said, if they had instead sought land on the opposite side of Thomas Road or Santa Teresa Boulevard.
“This situation was created by the school district and now they’re trying to figure out how to deal with it,” he said. “They’re getting screwed. They made a mistake by selling the land. They did not manage their assets properly and this is costing them a lot of money. Now you have a land owner that says, ‘If you want to buy this land, you’re going to pay four or five times as much as we paid for it.’ ”
Experts who came up with the competing land appraisals will serve as the primary witnesses when the trial begins later this month, said GUSD attorney George Speir. The trial is expected to last through the first week of December. It remains unclear if Glen Loma can assemble a land-swap offer before the trial reaches conclusion. Attorneys for both sides said courts are reluctant to postpone trials unless the parties are close to a settlement.
“There’s not a lot of time,” Speir said. “But that doesn’t mean that if they came up with something that made sense to us, we couldn’t work on it.”
Members of the GUSD board of directors were reluctant to comment on the matter since it is in litigation, though newly elected member Denise Apuzzo said last week that she would have expected greater effort by Glen Loma to win good will in the community.
