Authorization for the disposal and sale of the real property at 15-19 Oak Street

Petitioner: Mariah Nobrega, TMM4, Neil Wishinsky, TMM5, Ben Franco, Select Board Member

Special Town Meeting, November 2019

In furtherance of the proposed Baldwin School project, Town Meeting authorized the purchase of three residential condominiums at 15-19 Oak Street in December of 2018. The transaction was completed in early 2019 and the cost of debt service for the acquisition was incorporated into the debt exclusion referendum which was rejected by Brookline voters at the Annual Town Election on May 7, 2019. Annual debt service is expected to average about $333,477 for a 25-year borrowing period. With the failure of the debt exclusion referendum, the matter of whether the Town should sell the properties has been raised since the reason for the acquisition has not come to pass and there may be alternative uses for the funds. This warrant article is being filed to preserve the Town's ability to sell the units and to insure that this debate happens at the November Town Meeting.

Recently, the School Committee proposed using the Oak Street condominiums as office space in the fall of 2020 as part of their overall space planning. The Building Commissioner has raised a number of zoning and building code requirements to convert the Oak Street residential properties into office use. It is likely that there are more cost effective approaches to providing the required office space but that would need to be further analyzed. If the Town decides to sell the Oak Street properties, the School Department would be required to issue a Request for Proposals (RFP) to identify other leased space for administrative offices. Sale of property requires an open and competitive process to realize the highest price possible. Note that should this be approved by Town Meeting, the Select Board would not be required to sell the properties. This is merely an authorization to sell. The Select Board would also determine the timing of such a sale, if one occurs.

Official Town Meeting Vote	Select Board	Advisory Board
No Action (Requires 2/3 Majority)	Favorable Action	Favorable Action
147-77-3	4-0-1	23-0-0
Final Result: No Action (Requires 2/3 Majority)

Community Organization Recommendations

PAX	Green Caucus

Official Text of the Article

VOTED: That the Town adopt the following resolution:

Resolution Pertaining to Oak Street Property Disposition

WHEREAS, on February 1st, 2019 the Town of Brookline purchased the properties 15, 17 and 19 Oak St (the "Properties") for municipal purposes and more specifically in anticipation of a successful debt exclusion vote to construct a school commonly referred to as The Baldwin School, and;

WHEREAS, such debt exclusion vote failed and there are no existing plans to construct The Baldwin School or any facility that would require the land or the properties list above, and;

WHEREAS, the Town paid a total of $4.7 million for the Properties which were assessed to contribute combined real estate taxes of $33,548 in FY 19 which were instead absorbed by all other taxpayers in Town, and;

WHEREAS, the Properties are neither designed nor constructed for economical use for any purpose other than residential use, and;

WHEREAS, the Properties cannot be rented at levels that would enable the Town to substantially mitigate the implicit and explicit costs of carrying and maintaining the properties, particularly once the Town begins to amortize the debt used to buy the properties, which the Town is required to do in FY21, and;

WHEREAS, putting the Properties back on the tax rolls would be considered new growth, thereby adding approximately an additional $43,000-$45,000 property tax revenue to the Town, and;

WHEREAS, the estimated implicit and explicit negative cost of carry to the Town currently approximate $124,000 per year and will increase to as much as $315,000 per year when the acquisition debt begins to amortize in 2021, and;

WHEREAS, explicit negative net 'cost of carry' incurred by the Town has an immediate and direct impact on the Town's Capital Improvement Program, and;

WHEREAS, Town Meeting has provided the Select Board with the authority to sell the Properties,

THEREFORE, BE IT RESOLVED that in consideration of the budgetary impact of maintaining Town ownership the Oak St properties, the current cost of rebuilding the Driscoll school and the possible $10+m increase in that appropriation, the Advisory Committee calls upon the Select Board to dispose of the Properties as soon as possible, with the following conditions and alternatives:

1. If the School Committee and School Department wish to carry the cost of the Properties and to absorb the entire explicit net 'cost of carry' they may do so. If they so choose, the School Department will also be the beneficiary of any positive net proceeds if, and, when the School Committee requests that the Select Board sell the Properties.

2. The Select Board determines, through consultation with realtors, that the sale of the Properties would generate a total loss (defined as the sale price less any negative net cost of carry less any outstanding debt) that could be avoided or materially reduced by maintaining ownership for a period of not more than three years from the original date of purchase.

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