Sunday, July 18, 2010

An HQ PDQ?

In analyzing the proposed Jefferson-Houston redevelopment project, two things nag at the Growler.

If there is a solid business case to be made for a new elementary school based on maintenance vs. replacement cost, why not simply include it in the ACPS capital budget request as a priority project? Just fund it through the usual process, as ACPS is planning to do with Cora Kelly and Patrick Henry, and call it a day.

And if there are compelling grounds for building a new ACPS headquarters rather than continue renting on N. Beauregard Street, why not put it on the capital budget list as well? In fact, could an inoffensive low-rise office building be squeezed in somewhere on the Jefferson-Houston site, say on the unused open space in front of the pool?

In both cases the projects, if justifiable, could be accomplished without the private hyper-development.

What the Growler suspects, though, is that Dr. Sherman's plan to build a new ACPS headquarters building is the real driver behind the public-private partnership proposal. In fact, could Dr. Sherman be advocating the partnership because he has been unsuccessful convincing City officials that a new headquarters building is an urgent need right now, given other pressing capital priorities and a debt ceiling Alexandria is now bumping up against?

In this scenario, a Dr. Sherman thwarted by the City bean counters (but determined to have a new headquarters building) would be motivated to find an alternative way to generate cash flow independent of City appropriations to move ACPS headquarters. In essence, he would try to get what he wanted by offering to pay his own way.

Have your doubts about this scenario? Then explain why Dr. Sherman and the School Board were so anxious that Council agree to enter into an MOU right at the June work session, and why the CB Richard Ellis representative spoke about the need to move quickly to market. Is it because the renegotiated leases on N. Beauregard Street are scheduled to expire in 2013?

It may never be known who first brought it up as a template for Alexandria, but the 2001 Oyster School redevelopment in northwest Washington D.C. is widely known as the textbook example of a successful public-private partnership option in the educational realm. But its back story is not similar to that of Jefferson-Houston. In fact it is much more like Mount Vernon Community School.

According to Rebecca Diane Freeman's book Bilingual Education and Social Change, in 1991 shortly before the community began its crusade for a new school, "third-grade students performed between 1.6 and 1.8 grade levels above the national norm, and Oyster sixth grade students performed between 4.4 and 6.2 grade levels above the national norm." (p. 23)

While the school population had morphed over the years from white to primarily lower-income Hispanic immigrants, since the early 1980s Oyster had been thriving once it became a bilingual school. The greatest challenge was overcrowding; by the 1990s the school was at 130% of capacity and kids were being housed in closets and temporary metal buildings. There were also long waiting lists for enrollment.

So if the academic example of Oyster isn't quite relevant, Dr. Sherman and ACPS appear to be embracing its financing structure. Which of the Alexandria school district's properties would yield the maximum return in an Oyster-like deal?

Enter Jefferson-Houston, sitting on a valuable chunk of land with close proximity to Metro. As a prime property, it could be used to leverage private development to build offices for bureaucrats. Throwing in a new school would be necessary politically because there would have to be some shred of justification for leveraging the property and selling the sudden massive arrival of development in a residential neighborhood.

From Dr. Sherman's perspective, there would be a lot of advantages to leveraging Jefferson-Houston to get a new ACPS headquarters facility. He would get his administrative building off N. Beauregard Street just as the BRAC traffic snarl at Mark Center was being felt in all its intensity. He could position himself as a hero to the politicians for finding an off-the books method to finance the school and HQ while also generating tax revenue for City coffers from the private development. And he could throw a bone to JH parents who have been lobbying for a new school.

But there are just a few problems with this plan.

The Oyster School project was much simpler. The community's only goal was to build a new school, not an additional office building for administrative staff. Adding another structure at Jefferson-Houston means the density granted to the private partner must shoot up in order to foot the bill. (Remember, readers, that the James Bland public housing development ended up very dense because the project required a lot of market rate units to spin off the cash to pay for the Glebe Park replacement.)

In addition, Oyster School was a single property owned by the D.C. school district. To make this unwieldy project work ACPS is urging the City to throw its properties like the Buchanan playground, pool and Durant Center into the mix and is also angling for ARHA to offer up Jefferson Village.

But neighborhood outcry about the potential loss of amenities like the Durant Center and open space which is already bubbling up (despite Dr. Sherman's personal comfort level with rooftop soccer) makes it likely that the City will require the private development at Jefferson-Houston to be sufficient to pay for replacement facilities. As everyone who participated in the Braddock Road Metro charrettes knows, asking for additional amenities from development means pushing up the density. It is also not clear that ARHA is ready to participate (more on that later).

And oh, let's also talk about parking. You want underground parking in a historic district? Expect to pay $35,000 to $50,000 per space to build it. At the Council work session there was talk about underground parking for as many as 1,000 cars. Readers can do the math.

As a result, the neighborhood is now looking at a worst-case scenario of 1.2 million square feet and a floor area ratio (FAR) of 2.5. And many residents are appalled.

So readers, does this explain why there has been so little consultation with the neighborhood on what we want or don't want? Is it the Braddock Road plan and Bland all over again, with everything dumped in our neighborhood to suit the financial convenience of City agencies?

Some residents — but by no means all — might be sympathetic to a deal that results in a new elementary school. But how many neighbors will eagerly accept this sort of density just to build a new home for school bureaucrats so they can avoid the BRAC mess?