Woodland Park RE-2’s Board of Education tabled a decision on whether to approve a 30-year lease agreement for Merit Academy after hearing concerns and priorities from the district’s own personnel, along with a breakdown of needs for the charter school.

The board also agreed it needed to consult with its legal counsel, who was not present at Thursday’s special meeting.

Talks for the long-term agreement began shortly after the board approved a 30-year contract extension with the school in August.

The board originally planned to have this discussion Tuesday, but board President Mick Bates said it received the agreement earlier that day with little time to review it.

“Since then, there have been some challenges found in the lease,” he said.

Bates said the changes to address included verbiage regarding appraised and fair market value and “ongoing oversight to ensure the charter school’s financial health aligns with the charter contract and state standards.”

David Kuritar, the school district’s chief financial officer, expressed concerns with the agreement as it’s currently written and its 30-year time span, believing it wasn’t required.

He specifically highlighted that, if approved, Merit would be able to sublease the building to other lenders without district approval and that the lease would automatically extend if there’s any debt beyond the original term.

“The concept for Merit being able to sublease this (building) to a third party, to be able to collect rental income from that that wouldn’t flow back to the district, is just distasteful,” Kuritar said.

“If we can’t earn rental income and they can … morally, I’ve got great concerns with it.”

As an alternative solution, he suggested a memorandum of understanding that would be contingent on securing the funding through means like a certificate of participation paired with a voter-approved sales tax and Merit establishing a cash reserve.

Merit Academy Headmaster Gwynne Pekron said the school, like the rest of the district’s schools, is “in dire need of improvements” and that the lease option offered a unique opportunity to address them at their own pace.

She added that the school already experienced budget challenges in light of the lost funding it had anticipated from a local sales tax that ended earlier this year and has reached out to different potential lenders to help fund these needs.

“WPSD (Woodland Park School District) had a facilities budget of $250,000 this year,” Pekron said. “So we said, ‘How in God’s name is our district’s facility going to get repaired and improved and how can we take care of the facility we’re in?’ So, that led to that lease.

“Because we had to have certain things in there that could not be removed, or the lenders would not lend us the funding for that.”

One of the needs mentioned was failing security doors and Pekron noted that the school has decreased raises, removed some teachers and assistants and enacted fees to offset some financial losses.

According to the district’s Facilities Director Jason Farris, a needs assessment previously conducted found that about $40 million in repairs were needed throughout the district, with the Merit building accounting for about $1.4 million of the $25 million in what he called “pretty immediate needs.”  He called it the “nicest facility” and added that the thought of losing control of the asset makes him “extremely nervous.”

He suggested that a mutual agreement be reached to address all the schools, including Merit, with a payback arrangement.

No action was taken at the meeting, but board member David Rusterholtz inquired about scheduling a meeting the following Monday to vote on the lease agreement. This idea was shot down by district officials, who said there wouldn’t be enough time to address their concerns.

Interim Superintendent Ginger Slocum acknowledged the success of Merit in recent years in academic achievement and in providing school choice and the overall positive addition it has been to the district.

“But we have to be fiscally responsible for our entire district,” she said. “And I think, truly, (that) slowing things down and rebuilding trust in our community and finishing our audits is the first step in the right direction.”

Public comments followed the discussion. Despite some instances of interruption and argument from other attendees and board members, most commenters thanked the board for scheduling the discussion and holding off any decisions until a later date.

“I’ve been very, very concerned about what’s happened to our community and our schools since 2021 and one thing I’d like to say is how much I appreciate the change that I see tonight in this board,” commenter Holly Sample said.