New Haven’s economic development chief was home watching the Brazilian Grand Prix when his eyes wandered to the text of a 32-year-old court decree — which led him to give a second shot to a Fair Haven community group’s quest to buy a mothballed historic school.
As a result, the Harp administration this week granted the Fair Haven group — a community coalition called SPACe (Strong Performing Arts Center) — six months to develop a stronger proposal to buy the circa 1915 former Strong School at 69 Grand Ave.
Just a week earlier, a City Hall committee had rejected SPACe’s proposal to pay the city $250,000 and then spend $7.5 million converting the 1.055-acre site into a community arts center with a 100-seat theater; six 2,400-square-foot three-story townhouse apartments renting for $2,350 a month; six smaller “penthouse apartments”; and office space for arts organizations and other not-for-profits. The committee decided the proposal failed to address crucial questions such as where the money would come from; the development team’s qualifications; how much asbestos or other pollutants needed to be removed; and whether the roof can support apartments.
SPACe was the only bidder to respond to a city Request for Proposals (RFP) to buy the school. Its leaders wanted a chance to answer the committee’s questions. However, normally the city cannot allow a group to revise an application or answer more questions once it has submitted an RFP. So, in the view of city Economic Development Administrator Matthew Nemerson, the committee would have to start all over with a new RFP.
SPACe organizer Lee Cruz objected, saying that the city should meet with SPACe to give it a chance to improve the proposal. He argued that the city should make a special effort to work with community groups like his, which don’t have the same resources that for-profit developers have to submit question-proof proposals. Nemerson said he felt his hands were tied, legally.
Fast forward to this past Sunday, when Nemerson was home and the Grand Prix was on the television.
Judge Burns’ Rules
Paul Bass Photo
As usual, said Nemerson (pictured), he had a stack of papers around to catch up with at some point. “I take home probably 100 documents every weekend,” he said. “Depending on how bad the football games are, I go through a lot of them.”
During the Grand Prix, he pulled out the text of a 1982 consent decree in a federal lawsuit filed against the city when it sold another school, the old Roger Sherman School in the Edgewood neighborhood, to the Gan religious organization. That consent decree spelled out rules for selling surplus school buildings in the future.
“I said, ‘This is fascinating. There are all of these things that the city agreed to as part of the court case. It was a very interesting and detailed and nuanced discussion about what makes [a sale process] fair,” Nemerson recalled.
Two decreed rules in particular caught Nemerson’s eye:
• “[D]iscussions may be conducted … with responsible offerors, who submit proposals determined to be reasonably susceptible of being selected for recommendation, for the purpose of clarification to assure full understanding of, and responsiveness to, the solicitation requirements. … [R]evisions may be permitted after submissions and before final recommendation … for the purpose of obtaining best and final offers.”
• “The [city] shall make a special effort … not to place [a] non-profit organiation in a disadvantageous position due solely to the form and elaborateness of the presentation, but shall rely on the proposal’s content, substance and community merit with respect to the evaluation factors set fort in the request for proposals.”
In other words, he concluded, the rules for selling school buildings through RFPs differ from general rules about RFPs. The city can ask follow-up questions with bidders. And it can take extra measures to give not-for-profits or community groups a chance to clarify their proposals.
(Click here to read the consent decree, which was signed by U.S. District Judge Ellen Bree Burns. The quoted passages appear in the Exhibit A.)
Space For SPACe
Chris Randall/I Love New Haven Photo Illustration
The Strong School.
Nemerson brought his discovery to the selection committee that had unanimously rejected the SPACe proposal. Wednesday night the committee — which includes architect Ken Boroson and Craig Newick, community activist Jane Coppock, and Alders Abby Roth and Richard Furlow — met for hours with SPACe members. It grilled Cruz, project architect Fernando Pastor, and others on the financing and other questions. Then the committee met for another hour to decide whether to give the proposal another chance.
In the end, it decided to give SPACe six months to answer a series of questions and keep its proposal alive.
It will set up a schedule of questions to be answered, cumulatively, month-by-month, Nemerson said.
In the first month, SPACe will need to “refine and come up with more details about” the cost of the project, according to Nemerson. In the second month it will be asked to “come up with new sources of money, debt and equity and grants and tax credits that are logical under the circumstances.” More detailed questions will follow in subsequent months.
Melissa Bailey File Photo
Lee Cruz (pictured leading a tour of the school earlier this year) applauded the committee’s decision Thursday evening. “This is what we asked for,” he said — a second chance. Fair Haven activist Crystal Manning chairs the group’s board. Cruz serves as vice-chair; Donald Harvey serves as secretary.
He said the group is “in conversation” with an unnamed “out-of-state nonprofit organization that aggregates wealth investors and pursues environmental tax credits.” With this six-month reprieve from the city, he said, SPACe can now seek to line up other, more local philanthropists and foundations to make pledges to support the project.
At the time of submitting the original proposal, Cruz said, the group didn’t have the $30,000 to conduct an engineering study of the ability of the roof to support six apartments. If it turns out that shoring up the roof would cost too much to make the plan viable, Cruz said, he’s still confident the overall plan can be made financially feasible.
The city failed in two attempts to get a private developer to submit a proposal to buy the Strong School. Clearly, Cruz said, a rehab of the historic property appears not to promise large enough returns to justify that kind of private for-profit investment. He believes that it can generate enough money to support a community group’s proposal that doesn’t seek the same kind of returns. Now he and his colleagues will have six months to prove it.
#1) Since non-revenue generating portions of non-profit property holdings would be property tax exempt the city should only five advantage to non-profits that can clearly illustrate economic development which will pay for the loss of property taxes. (I wrote this before I realized that the consent decree actually agrees with me and makes this its first stipulation)
#2) To avoid problems after a submission, have a pre-submission process in which city expectations for proposal completeness are explained to bidders. (I wrote this before I realized that the decree agrees with me; there's no mention I can find about later re-do's...pretty sure the proposals have to be accepted on-time, as is.)
#3) The decree focuses on fairness but since there was no competition, how can one say the judgment of proposal incompleteness has anything to do with unfairness rather than its content?
#4) Never watch TV and opine at the same time.