By Emma Rausch
emma@thepaperofwabash.com
WABASH COUNTY,IN The MSD of Wabash County School Board accepted a bid to sell the former LaFontaine Elementary school building at its Tuesday meeting, July 26.
Pending all legal requirements, the Board accepted the $55,000 bid from Cornerstone Property Management, a Wabash-based company.
The Board also had the option of selecting a second, lower bid of $6,100 from Gold Nugget Properties, a company based in Meadville, Mo.
“Looking at the two, naturally you gravitate toward the higher dollar, but it was also looking at that we at least had a local party that was providing the largest bid,” Board member John Gouveia told The Paper of Wabash County following the meeting. “Conventional thinking is if someone’s going to invest that much money into a purchase, they’re not going to come in and destroy it.
“They’re going to come in and do something with it and I think that’s been a concern for LaFontaine residents in general, that that community cornerstone has some functionality.”
The Board’s acceptance of the bid does not finalize the sale, but it allows Cornerstone Property Management the opportunity to move forward with the purchase.
However, once the company finalizes the purchase, the transfer will benefit the LaFontaine community, according to Gouveia.
“The nice thing is for LaFontaine is once it’s transferred off of our books, it then becomes taxable,” he said. “So the town of LaFontaine will actually get a benefit out of this because they’re going to have a new building which will have assessed valuation and taxes paid on it rather than having taxes to support it.”
Before accepting the bid amount, Gouveia raised the issue of bond provisions remaining on the property.
“The school has existing debt obligations to which each obligation is secured by what’s called a lease,” Gouveia explained to The Paper, “and we have a separate corporation, a building lease corporation which signs for those obligations. So any obligations that were initiated under the original context of the debt obligation with LaFontaine (Elementary) have to be retired be retired by specific bond.
“I was just raising the issued because bonds, depending on how they’re written, can have call provisions, termination provisions. We were at a period after the closure of that school where we legally have to retain that property, then put it up potential public sale.”
A bond provision will have to be “cleared up” in order for the Board to transfer the property, Gouveia explained.
During the meeting, Superintendent Mike Keaffaber told the Board that it still has “the option of upholding the property” until the obligations are paid off in July 2017 or proceed forward with accepting the bid, which the Board opted for.
“When the (bond counsel) looked at the bond, they said it was written in such a way that it was a lot different than what they’ve seen because the bond was the 1997 bond that was refunded in 2007,” Keaffaber explained, “and so like it says (in the agenda), those legal requirements have to be taken care of, have to happen first.”
Despite the legal snag, “(Cornerstone Property Management) understands that we need to clear up some things in order to transfer the property,” Gouveia said.
“So we’re just awaiting on our bond issuer to say, ‘Here’s where you are on the debt line. Here’s what the amount of sale is. This is what it’s going to be applied to (and) the balance is brought down and we’ll release the corporation the obligation of.'”
The facility is expected to be sold within the six months, according to Gouveia.
In other news, the Board approved Keaffaber’s superintendent contract.