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Sale of former schools nets District $42 million

Exterior of West Philly High building.
Photo: Nathaniel Hamilton | NewsWorks WHYY

This article was originally published in The Notebook. In August 2020, The Notebook became Chalkbeat Philadelphia.

The George W. Childs Elementary School at 17th and Tasker Streets in South Philadelphia once resonated with the sounds of more than 500 students in its halls and classrooms.

The school relocated in 2010, leaving behind a century-old building that’s now slated to become a mixed-income housing complex.

Childs is one of 12 former schools the Philadelphia District has sold since 2013. Sales are pending for 14 more properties. These empty buildings have been cast alternately as neighborhood eyesores, reminders of upheaval in the city’s education landscape, and sources of revenue for a cash-strapped District.

Selling school buildings is ‘complicated … and a lot more costly’

In 2013, uncertainty about whether the District would have enough money to open on time spurred changes to the process of selling buildings.

Councilman Darrell Clarke and Mayor Nutter released dueling plans for expediting sales to generate more money for the District. Each promised a $50 million infusion of cash.

While the city vowed to give that money to the District, regardless of its ability to pay it back, District officials promised to raise $61 million in building sales that school year.

The actual amount netted by selling off old facilities during that period, according to the District’s Chief Financial Officer Matt Stanski, was about $24 million.

It’s not uncommon for school districts to realize much less than the actual sale value, for a number of reasons, said Emily Dowdall, a researcher at Pew Charitable Trust’s Philadelphia Research Initiative.

"A lot of cities have had trouble related to the bonds that go into buying and maintaining their school buildings," said Dowdall. "It makes selling them a lot more complicated and a lot more costly."

Those bonds, which cities can take out for capital expenses, have to be paid down for a building to change hands.

Out of a total $67.6 million in building sales over the last two years, the District netted $42 million after bonds and closing costs.

That disparity is one reason why the District drew fire from public school advocates such as Helen Gym, who questioned whether the District could use "under-utilization" as a rationale for closing school buildings while simultaneously expanding charter schools.

"District officials have not disclosed a full accounting of the transition costs and other expenses associated with closing schools – something that should be of grave concern given what we know about school-closing expenses," wrote Gym, in a 2012 opinion piece published in the Philadelphia Public School Notebook.

The $42 million netted by the District from sales does not include a full accounting of money spent or saved on personnel, transportation or administration related to the school-closing process.

Read the rest of this story at NewsWorks

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