Closed schools could remain vacant without public subsidy


Photo by Max Herman

A developer offered to buy Emmet Elementary, one of 50 schools shuttered in 2013, for $75,000 but the deal fell through when partners pulled out citing community opposition.

Developer Rob Ferrino stood to face two dozen people who’d gathered in the hot backroom of an Austin community center in mid-July. Raising his voice over the din of a fan, Ferrino explained that he wanted to move forward with a $24 million plan to turn a vacant school into a health center, but two key partners had pulled out.

Why the deal died speaks to the difficult nature of repurposing closed schools, especially in disinvested communities like Austin where distrust of Chicago Public Schools and outside developers runs high.

Austin residents first learned last October about a proposal to revitalize Emmet Elementary, one of 50 schools shuttered in 2013. Cook County Health and Hospitals System and PCC Community Wellness Center were on board and Ald. Chris Taliaferro touted it as a way to bring needed investment to the 29th Ward. Shortly after, CPS took over responsibility for repurposing schools and put Emmet and more than two dozen other schools up for sale. Ferrino’s company offered to buy Emmet for $75,000, but CPS called for more feedback after getting lots of questions about the project.

Last month, residents reiterated concerns about the potential impact on existing Austin businesses and the lack of transparency in the planning process. Ferrino’s partners then jumped ship, citing a lack of community support.

“We were opposed to the process, or lack thereof,” said Cata Truss, a long-time Austin resident who attended several meetings on Emmet. “It was never about the project necessarily, but the fact that we were not included in the conversations.”

Amara Enyia, who directs the Austin Chamber of Commerce, says when CPS took over school repurposing and put Emmet up for sale, it “put a rush on a situation that was already tenuous.”

“There’s a way that things need to be worked through,” she said. “We have to make it clear to developers that you have to get buy-in on the front end, instead of having to backtrack.”

Yet even when a community supports a proposal, partners are lined up and financing is available, it can take months — or years — to successfully repurpose a school.  Meanwhile, the inventory of shuttered and vacant schools is slowly growing.

The former Wadsworth Elementary building in Woodlawn, half-emptied in 2013, will soon become completely vacant as the University of Chicago charter school that occupied part of the building moves to a new location. Neither the local alderman nor the Hyde Park-Kenwood Community Action Council, which weighs in on educational plans in the neighborhood, know of any planned uses for the school. And the planned closures of four Englewood high schools will leave behind another giant building without reuse plans.

The Chicago Reporter is keeping close tabs on what’s happened to the closed schools. So far, CPS and the city have reused five vacant schools and sold 18 — half of them purchased in the months since the district took over repurposing responsibilities from aldermen, who largely failed to find buyers over the three and a half years they were in charge. Of the schools that sold in previous years, few have become functional again.

Twenty schools have yet to sell, all of them in predominantly low-income African-American neighborhoods. CPS plans to put the schools, including Emmet, back out for public bid later this month.

Photo by Max Herman

Austin residents use the parking lot at the shuttered Emmet Elementary School as a walkway.

Roadblocks to financing

Years ago, in a seminal 2013 report, researchers at The Pew Charitable Trusts pointed out that “selling a vacant school building, even at a low price, does not guarantee successful reuse, only a change of ownership… Properties may remain vacant or derelict if financing falls through…”

In a follow-up analysis, the report’s editor continued: “Buyers may not have clear plans for properties, and even when they do, many aspects of the redevelopment process — such as repairs, zoning approvals, financing, and community concerns — can delay or even derail a project.”

Several of the most recent sales in Chicago depend on federal tax credits that have yet to be awarded. Developers plan to turn at least five former schools into affordable housing and are seeking low-income housing tax credits to help fund the proposals. In these cases, a highly competitive process will become even more so: Many of the schools were sold around the same time and will compete against one another for funding.

Developers of the former Ward and Wentworth schools in Humboldt Park and Englewood are considering applying for low-income housing tax credits from the state soon, while projects at the former Bontemps, West Pullman and Calhoun schools in West Englewood, West Pullman and East Garfield Park are competing for low-income housing tax credits from the city. The application process ended last week and developers could be notified of the city’s decision as soon as this fall.

Developers for Bontemps and West Pullman have contingency clauses written into their contracts with CPS, allowing them to walk away from the deal if the tax credits don’t come through.

The developers say they need the clause to protect them from ending up with large, vacant buildings with high repair and maintenance costs that they can’t pay without the financing. It would be disrespectful to communities, they added, if they bought a building knowing they couldn’t redevelop it.

If the financing doesn’t come through, developers could ask CPS to extend the contract timeline so they can try again for funding.

Chicago is one of the few cities in the country that can allocate low-income housing tax credits, but applications open infrequently; the last round was in 2011. This year, the city’s application states that projects reusing and rehabilitating existing buildings, such as schools, are a top priority “to help alleviate the negative impact that vacant and/or deteriorated buildings can have on neighborhoods.”

But “there’s no guarantee that we’ll be successful” in getting the credits, as developer Scott Henry put it.

“The city’s resources are scarce and there’s a lot of really terrific projects out there,” said Henry, a co-owner of Celadon Holdings, which purchased the former West Pullman school. “[The city has] given us no indication one way or another what our odds are.”

Approval of financing would bring to fruition one community-led project that’s been years in the making. In partnership with two nonprofit developers, the Resident Association of Greater Englewood, or RAGE, plans to turn the former Bontemps school and the surrounding land into affordable housing, a space for workforce development and an urban farm that connects with the planned Englewood Trail.

Asiaha Butler, the president of RAGE, says it was important to the community that the Bontemps project offer more than just affordable housing, so the neighborhood group searched hard for partners, IFF (formerly known as the Illinois Facilities Fund) and Heartland Housing, who’d work toward that goal.

“The community has to be at the forefront of what happens to these institutions,” she said. “Our voices are equally important as a check from a developer.”

Butler says while the city hasn’t truly tackled the problem of empty schools, it has an opportunity to prioritize one of the five shuttered schools in Englewood. Bontemps is not far from other recent investments, like a Whole Foods grocery store and the new Englewood high school.

“We’re just really hoping that this will be something that… we didn’t let this structure just get demolished, like many other institutions in our community,” she said. “We’re not just repurposing a school, but reviving a whole little campus.”