By Leslie Collins
February 1, 2012
Two organizations have partnered together to ease the financial burden of repurposing Kansas City Public Schools’ shuttered schools.
“We want to support all efforts of community development,” IFF Missouri Executive Director Kirby Burkholder said. “One of the things we’ve seen are schools and school buildings are anchors of the community.”
Two years ago, KCPS shuttered more than 30 schools as part of its right-sizing initiative to balance the budget. For Historic Northeast, both Thacher Elementary and Northeast Middle School have become targets of vandalism, including arson that severely damaged Thacher.
“Empty schools create issues for our neighborhoods that we work in; they lower property values,” said Chris Vukas, senior lending and underwriting officer for the Greater Kansas City Local Initiatives Support Corporation (LISC). “If they (school buildings) can be repurposed and be reused, we absolutely want to support that effort.”
Both LISC and IFF recently hosted a community meeting to announce their partnership in the school district’s repurposing effort, as well as explain the tools they can provide.
IFF, a nonprofit lender and real estate consultant, serves five states including Missouri. One obstacle nonprofits face is serving low income communities, Burkholder said. An organization might invest $1 million in a building only to have it appraised for $500,000, he said. IFF helps fill that gap by offering below-market rate loans that aren’t tied to appraisals, he said. Instead, IFF looks at a nonprofit’s ability to service the debt over the long-term. Through its lending program, IFF can offer up to 15-year loan terms and up to 95 percent of a project’s cost. IFF also provides real estate consulting services. Only established nonprofits, those in operation for at least five years with three year’s worth of audits, are eligible for loans from IFF. For start-up nonprofits, one solution is to partner with more established nonprofits to repurpose a school, he said.
LISC offers up to 7-year loan terms for nonprofit, for-profits and government agencies. Types of loans include acquisition, pre-development, construction, bridge loans and more. LISC also assists with underwriting, grants and technical assistance.
“We compliment each other in the types of loan products we offer,” Vukas said of LISC and IFF partnering together.
In addition, LISC and IFF can now offer a service package that caters to more needs, Vukas said.
It’s a way to share the risk, Burkholder added.
“We’re really excited,” said Shannon Jaax, KCPS repurposing initiative director. “It’s one of the things we hear from nonprofits especially that are interested. Many of them have not actually purchased a facility and renovated it (before). This was a great opportunity for them to hear from organizations that are here to provide the technical or financial assistance that’s so very needed.”
Shuttered schools update
To date, KCPS has received more than 130 informal proposals for the shuttered schools and is now soliciting formal proposals for eight school sites. The first set of formal proposals is due Feb. 15 for Swinney, Bingham, Askew and McCoy. For Bryant, Blenheim, Graceland and Pinkerton, formal proposals are due Feb. 17. KCPS will solicit formal proposals for the remaining schools in phases to allow adequate review of each proposal, Jaax said.
During the review process, KCPS will be evaluating whether or not an organization possesses the manpower and financial means to carry out the plan, past track records for completing similar projects, financial benefits to the district and whether or not the proposal compliments neighborhood priorities. No time line has been set for reviewing the proposals, she said.