Kingman, KUSD finish building accord

City Council unanimously approved an agreement Tuesday with the Kingman Unified School District that allows the district to use the old development services building for its Kingman Online Learning Academy.

Though the district is responsible for all utility costs, routine maintenance and janitorial work, it will not be required to pay rent. In exchange, the city gets to use district meeting rooms, including the auditorium at Lee Williams High.

"I'm really excited," said KUSD Curriculum Director Jeri Wolsey, who has spearheaded the creation of the online school. "But I was really worried (before the meeting)."

Since the decision worked out in her favor, she went ahead Wednesday and purchased paint, picked up some fake plants and designed the layout for the room that will be used for the first batch of students.

There are 13 students currently enrolled in the program and another seven have applied and are going through the process of enrolling.

The plan is to open the school on Nov. 1, but making that date is largely up to Frontier Communications, which still needs to connect the phone lines and Internet, Wolsey said.

As more applications come in, Wolsey's goal of getting 250 students into the school by August looks realistic.

The school had been housed at the district offices. Though district staff enjoyed having the kids around because it made them feel more involved with the schools, they'll be happy to get their quiet office back, she said.

Under the agreement, the city is responsible for maintaining the building's heating, cooling, lighting, roofing and electrical systems.

The city bought the building from MJB Investments in 2009 for $875,000, according to the Mohave County Assessor's Office. Until last year, it housed the city's development services department. But staff cuts over the course of a few years in the department led to development services staff moving into the City Complex in the summer of 2011.

Before purchasing the building, the city leased it. But the lease was getting too expensive, and it made more sense at the time to purchase the building, said City Manager Jack Kramer.

The city paid $6,750 a month ($81,000 for the year) in rent for the building in 2006, according to city records.

Once development services moved out, the goal was to sell or lease the property. But the state's government property lease excise tax made leasing the building out as retail space less than lucrative. An annual tax of $2.51 per square foot would be levied if the city leased the property as retail space, according to state documents. The property is 8,741 square feet, meaning a tax just short of $22,000 would need to be paid every year if the city found a retail-based company to lease it to.

It's basically a penalty to dissuade governments from competing with real estate companies that deal with leasing retail space, Kramer said.

The city could still sell the building without incurring any penalties but it hasn't been able to find a buyer.

The agreement with the district lasts for three years, but either party can back out of it by providing written notice. If the city were to find a buyer and then back out of the agreement, the district would most likely move the online school to the Desert Willow campus, said KUSD Superintendent Roger Jacks.