SURPLUS REAL PROPERTY DECLARATION AND
AUTHORIZATION TO SELL
DISCUSSION
Agenda Item #3
April 9, 2015
SUPERINTENDENT’S RECOMMENDATION:
Approve staff recommendation.
ORIGINATED BY:
The need to sell surplus vacated district property.
STAFF RECOMMENDATION:
Staff recommends the Board approve the resolution to declare the current administration building
(located at 4444 SE Lake Rd.) as surplus, directs staff to work to maximize the highest and best
use value, and market the property for its highest value.
In addition, staff recommends that upon selling the property, the Board directs staff to place the
revenue from the sale of the property in the Capital Projects Fund to be used to pay expenses
related to the remodel, fixtures, furnishings and equipment at the new administration building
located on Freeman Way.
BUDGET IMPACT/SOURCE OF FUNDS:
Some Capital Projects Funds may be used for services or improvements needed to sell the
property.
BACKGROUND:
1. The current 9,000 SF administration office was built in 1967 when the District served just
9,000 students. The Board Room and an office addition were completed over 20 years ago.
2. Today, 48 years later, NCSD has doubled in size and has become Oregon’s 5th largest
district… but we are still attempting to use the same 9,000 SF building.
3. Central office functions are currently forced to be located in several different sites.
4. The District made a promise to the community in the 2006 bond to add 20,000 SF to the
current administration building to consolidate administrative functions. $1 million was
budgeted, but the estimated cost to add 20,000 SF was over $4 million (in 2010).
5. In 2006, the District and the Citizens Oversight Committee evaluated investing in the
existing building, purchasing and remodeling a different building, or constructing a new
building.
6. At the time, real estate prices were high and the Citizens Oversight Committee agreed that it
would be a better long-term investment to build a new building for an estimated $6.0 to $7.0
million (in 2010) than to purchase used or add onto the current administration building.
7. Unfortunately, school finance collapsed (with the economy) and the proposal for a new
building was cut from the budget.
8. The District went back to the plan of adding space onto the existing administration building,
but heard strong concerns from the Board, Citizen Oversight Committee, neighbors, and the
Planning Commission about the long-term investment wisdom of investing in the existing
administration building site.
9. Given that real estate prices had dropped since 2006 and sellers were motivated, the Staff
discussed with the Board and Citizens Oversight Committee the potential long-term value of
purchasing a used building vs. investing in the short-term solution of building onsite.
10. Staff located an existing building (Freeman Way) that could be purchased without using
General Fund dollars. Staff received unanimous approval from the Citizens Oversight
Committee to recommend the purchase of the building to the Board.
11. The Board held two public meetings to discuss and deliberate before approving the purchase
of the Freeman Way building in December 2010.
12. The plan is to allow the current leases to pay for the financing of the building initially (until
August 2015), and then use Construction Excise Tax funds (restricted by law to be used only
for property and capital construction) to pay for the loan payments, remodel and furnish the
building to allow for the consolidation of administrative services by January 2016. Longterm, we propose the future bond pay this debt off.
13. The consolidation of administrative functions is also needed so that Alder Creek Middle
School can expand into the space currently occupied by Student Support Services.
14. The District is planning to consolidate administrative functions from four locations into one
location by January 2016.
15. The current administration building located at 4444 SE Lake Rd. will be vacated in 2016.
The property is 2.53 acres with a 9,000 square foot 2-story office building built in 1967.
16. In September 2012, the current administration building and property was appraised at
$1,250,000.
17. In 2013, the Board approved the use of Macadam Forbes Commercial Real Estate to assist
the district with selling and acquiring properties.
18. According to Board Policy DN Disposal of District Property:
Proceeds from selling district real property should be used for capital expenditures or
other one-time investments. Unless otherwise approved by the Board, proceeds from
selling district real property shall be placed in the Capital Projects Fund. If proceeds are
placed in the General Fund, they should only be used for capital expenditures, financial
reserve or one-time expenses, and not be used for ongoing operational expenses.
19. The Board must declare properties as surplus prior to selling and the Board must approve the
final sale of any real property.
The district sent letters in February to the surrounding community notifying them of the Board
meetings and potentially declaring administration building property surplus and selling the
property. These letters also invited input.
The attached resolution declares the property surplus and authorizes staff to begin the process of
marketing and selling the property.
ATTACHMENTS:
Resolution
Letter to the community with background attachment
PRESENTER / STAFF CONTACT:
Ron Stewart, Assistant Superintendent of Operations