Gilroy
– After a little financial maneuvering, the school district will
begin looking for a new location for its administrative offices,
most likely one that’s closer to Gilroy’s schools.
Gilroy – After a little financial maneuvering, the school district will begin looking for a new location for its administrative offices, most likely one that’s closer to Gilroy’s schools.
Although discussions for potential locations are just getting under way, Superintendent Edwin Diaz said two sites are being considered: one in the northeast corner of the site where South Valley Middle School is located, or another near Brownell Academy, where the old Jordan Elementary School used to be on Hanna Street. The district already owns both sites.
“We really don’t have any definite plans,” Diaz said. “We’re just beginning discussions. It’s very preliminary.”
Regardless of where exactly the new office building is situated, it probably will be on the west side of Highway 101 – where most of the schools are – as opposed to where it is now, on the east side of the highway near the Gilroy Premium Outlets.
Paying off what are known as Certificates of Participation, which the board approved at a Monday meeting, will give the district more flexibility in searching for a new office site.
The certificates are a program of the California School Boards Association Finance Corporation, and they help California school districts, county offices of education and community college districts raise money to acquire real estate and make capital improvements. The state association holds the title to the property until the district has paid back the money in the lease agreement.
In 1994, the district refinanced its certificates, which were originally used to purchase, construct and improve the district’s current offices, said Steve Brinkman, assistant superintendent of administrative services.
Revenue from the district’s sales of surplus land, totaling about $1.05 million, would pay off the certificates. Additional income is expected next year from the sale of nine district-owned lots near Antonio Del Buono Elementary, Brinkman said, which needs to be rezoned by the city.
The current balance for the certificates is about $1.2 million, Brinkman said. The original debt of the certificates totaled $3.57 million, and about $2.9 million of the refinanced certificates have been paid for from the district’s general fund, which the district wants to conserve as much as possible.
Retiring the certificates now will save the district from having to dip about $1 million into its general fund over the next three years, Brinkman said.
After retiring the certificates, the district will have a few options for relocation. It could sell all of the property that supports the current office building, which is two acres of developed land and two acres of vacant land just behind the offices. The funds from that sale would be used to build new offices.
Or, the district could keep its current building along with the two acres under it, and sell the remaining two acres of undeveloped land. The current offices would be leased, and the district would use that income to fund major maintenance projects that district officials say are necessary.
Lastly, the district could work out some other kind of deal, perhaps a combination of property sale and lease.
Because the state’s guidelines are strict regarding how funds for surplus land sales can be used, district staff met with two lawyers and submitted a letter to the state checking the legality of using surplus land sales to retire the certificates. Earlier this month, the state gave the district the go-ahead.
