Education

Councilwoman calls on state to reject $42.5 million lease for NPS headquarters

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765 Broad Street is slated to be the new headquarters for Newark Public Schools.
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Central Ward Councilwoman Gayle Chaneyfield Jenkins continued her offensive on the district’s plan move from its 2 Cedar location, calling for the state Local Finance Board and the state Board of Education to reject a 16-year, $42.5 million lease approved recently by the Newark Public Schools Advisory Board for new headquarters offices for the state-run district.

“It is essential for the long-term fiscal and academic future of Newark's students and all its residents that the LFB and NJDOE reject this lease proposal so that all parties can take a step back and consider the best long-term interests of the district in an orderly and competent fashion,” Chaneyfield Jenkins wrote to Timothy Cunningham, the chair of the Local Finance Board in the Feb. 27 letter obtained by TAPintoNewarkpdf.

With its lease expiring at the end of July, NPS is looking to move from its current location at 2 Cedar Street in downtown Newark to a new location at 765 Broad Street, closer to City Hall.  as previously reported by TAPintoNewark, Schools Superintendent Christopher Cerf has stated the new lease will save the district some $2 million annually.

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“Our decision to relocate our headquarters to 765 Broad Street makes sound, financial sense,” Cerf said after the board approved the lease. He said the lease was part of an overall plan to cut $70 million from the school budget. (link to previous story)

Chaneyfield Jenkins first spoke out against the lease at a February 2 public hearing. After the hearing, the board could not muster enough votes to approve the lease. The board reconvened 10 days later and approved the lease 7-2 with board members Crystal Fonseca and Philip C. Seelinger Jr. voting against it.

In her letter, Chaneyfield Jenkins said the lease would not only cost NPS millions of dollars more than it would otherwise incur, “but it will bind the district to a very long-term transaction without the benefit of considering other alternatives for a generation to come.”  The district, Chaneyfield Jenkins said, has spent more than $100 million over the last 22 years on its lease at 2 Cedar Street.

“Historically, the district simply renews its lease in place because its management and advisors do not act with foresight to solve its long-term facility needs in an efficient or timely manner,” Chaneyfield Jenkins wrote. “This prompted the City to explore the possibility of providing a new publicly owned facility for the district back in 2004, which would have saved NPS tens of millions of dollars, but ultimately, NPS could not act with the timeliness or skill to pursue the opportunity for the benefit of all stakeholders.”

Chaneyfield Jenkins said the district now has another opportunity to explore options, but instead has opted to enter a lease to “benefit a New York based private property owner at the expense of our children.”

In her letter, Chaneyfield Jenkins said there were many “disturbing elements” of the transaction, including a flawed process. She said the district did not attempt to determine whether any assets it already owned could be used to house NPS headquarters.

“NPS's management and staff came to a rushed and ill-prepared conclusion that it would not be able to capitalize on any publicly owned property to serve its needs,” Chaneyfield Jenkins wrote. “

Chaneyfield Jenkins said the real estate broker involved in the transaction did not follow proper protocol in soliciting proposals from all viable property owners.   “What occurred was not only wrong and completely mishandled, but will saddle the Newark school district with a lease liability for 16 years at a rate that exceeds other alternatives, both public and private,” Chaneyfield Jenkins wrote. “The only beneficiaries of this outrageous breach of fiduciary duty is a New York based property owner along with the brokers who will all take their millions of dollars and spend them outside of the City of Newark.”

“I have the greatest respect for the councilwoman, but her claims are factually incorrect,” Cerf said. 

“Faced with a severe budget shortfall, we have targeted nonessential operating costs to ensure every dollar goes directly into our classrooms to support our students and teachers. In the last 18 months, we have created savings of over $70 million without taking dollars away from our classrooms,” Cerf said. “This kind of hard work and financial savings are unprecedented and reflect our top priority – the students of Newark.”

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