Large Crowd Shows Up to Help Decide the Future of Norrie School

IRONWOOD, MI - Tuesday, October 12, 2010 - A large crowd gathered Monday night in the Norrie School lunch room to weigh in on the future of the 93 year-old school building located at 401 Alfred Wright Boulevard. The original Norrie School was located near the top of Houk Street, just east of where Manny's is currently located. It was built in the 1800's and was closed in 1917 when the current Norrie School building was completed and opened. The old school house was converted into apartments and it burned to the ground three or four years afterward.

It was standing room only at last night's special meeting of the Board of Education of the Ironwood Area Schools of Gogebic County. The meeting was called to order at 6:00 PM by Board President Steve Thomas. The Pledge of Allegiance was recited and roll call was taken. All members were present.

Following the recording of the roll, the Agenda was unanimously approved by the Board without any additions or amendments.

President Thomas explained to the crowd on hand that the Board decided to do things differently than they are normally done. He explained that citizens comments on proposals are usually made prior to the presentation of the proposal. "We felt that it would be better to have the proposal presented so that you know what their doing, and then citizens may speak."

Thomas explained that each citizen would be allowed five minutes to speak and that ever effort would be made to allow everybody a chance to voice their opinions; ask their questions; and express their concerns.

"The purpose of this, from the School Board's point of view," Thomas said, "We did not wish to see an empty building standing on the lot. There are too many empty school buildings on the Gogebic Range. We have in our budget funds that are estimates of tearing down buildings -- taking the asbestos out initially and then tearing down the building. We also put an advertisement in the newspaper asking for proposals to do something with the building. Now, we have received only one proposal and that is why we are having the public hearing on this particular item this evening. It's important to us to hear from the individuals in the Norrie area -- actually throughout the city -- but especially in the Norrie area that would be the most affected by the building itself."

The floor was then turned over to Chris Forslund, Business Development Coordinator for Smet Construction Services, DePere, Wisconsin, who briefly introduced himself.

"For those of you who don't know me, my name is Chris Forslund. I grew up in Ironwood along with my wife Brenda Bulinski Forslund. Being in this lunch room is bringing back memories. It's been about thirty-five years since having lunch here in second, third, fourth, and fifth grade, but we don't have Johnny Carlson to yell at us, so we're in pretty good shape!"

Forsund began his presentation by pointed out four schematic drawings of the proposed building project (site plan), posted in the front of the room. The plans included floor by floor details regarding the remodeling of the existing building and the addition of patio homes on the property. Forslund explained that he would be explaining three "talking points" of information: (1) What his development group is planning to do to the Norrie School building and the adjacent property; (2) address why his group is doing this; and (3) the projected benefits for the project, both economic and otherwise.

Forsund then went on to describe his company's proposal. A hand out provided briefly describes the project:

NORRIE COMMUNITY APARTMENT HOMES & SENIOR COTTAGES

PROJECT DESCRIPTION:
Chris Forslund, Ironwood native, has assembled a development team to purchase the Norrie School property with the plans to: a) re-develop the school into apartment homes; and b) construct a number of single-story patio homes for clients 55 years of age and above on the lots behind the school.

There are 18 apartment homes proposed, ranging from 974 square feet to over 1,700 square feet. The smallest units will be the one bedroom, with a den and the largest will be two bedrooms with a den and formal dining room.

Other proposed amenities include:

Norrie Apartment Homes

Large kitchens with full-size Energy Star appliances
Open islands/breakfast bar with granite counter-top
Abundant closet and storage space
Original hardwood floors
12' ceilings
New energy efficient windows plus added thermal insulation
Individual high efficient unit furnaces with air-conditioning
Kohler bathroom and kitchen fixtures
Washer/dryer in each unit
Unique floor plans
Double deep garages included
Private unit storage unit on lower floor
Individually metered gas and electric
On-site manager
Security access control and monitoring
Large community room and exercise room

Norrie Cottages (patio homes)

New energy efficient construction (approximately 1,100 square feet)
Fully accessible single level residence
Two bedroom/two bathrooms
Double deep garage
Porches
Washer/dryer in each unit
Efficient furnace with air-conditioning
High ceilings
Large bathrooms
Kohler bath and kitchen fixtures
Full privileges at Norrie Apartment Home's Community and Exercise rooms
On-site manager

ECONOMIC IMPACTS

The proposed redevelopment would save the Ironwood School District over $200,000 in demolition costs.
According to the Ironwood City Assessor, the mill rate is 74.3021 for non-homestead. Of this amount, the school mill portion is 17.9892.

If the Norrie School would have a cash value of $1,000,000 after redevelopment, it would have a taxable value of $500,000 which results in approximately $37,151 in real estate taxes generated. The school portion of this would be approximately $9,000. The property currently is not on the tax roll and therefore generates no real estate taxes.

The nine proposed Norrie Cottages (single-story senior homes) would have a cash value of approximately $990,000. Using an assumed taxable value of $495,000, this would generate approximately $36,800 in real estate taxes. The school portion of this would be approximately $8,900.

Based on the above, the total taxes generated by the Norrie School Apartment Houses and Norrie Cottages patio homes are projected to total approximately $74,000 per year, of which approximately $18,000 would go to the Ironwood School District.

It is anticipated approximately $2,000,000 will be invested by the developer to do this project (school and senior cottage homes). We plan to use local subcontractors and materials suppliers at possible opportunity.
The project would help to satisfy a current need for quality apartment and senior housing options in the area. Market research shows that there are waiting lists in the market area comparable to the Norrie Cottage patio (single-story) homes for people age 55 and above.

Forslund explained that he would hate to see what happened to the Newport School and the J.E. Murphy High School happen to the Norrie School. He told the crowd that he brought the idea to his development team and he and an architect visited the site during the last week of September. They walked the property and tried to get some "conceptual ideas." He then referred to the handouts presented above.

He told the audience that he referred to the apartments as "homes" rather than "apartments" because the amenities proposed are the things that make a person feel like they are at home. He explained that the building and complex would have on on-site manager who would live in one of the units. He said the building would be a "controlled building" featuring 24-hour per day lock-downs; cameras and monitors; and other security.

He said the on-site manager would receive one of the eighteen units in the proposed complex, and his development group would be renting one of the units. He explained that his business associates love to hunt, fish, ski, and snowmobile, so they would be renting a unit to use when they are in the area.

"It's not only sending a message to the community," Forslund said, "It's staying connected to this project. So the residents of this building will know, in addition to the on-site manager, that you're going to have the ownership having one of the units. They're all going to have my phone number. They're all going to have my email. And there's an issue that isn't being addressed as it should be, by the on-site manager, I'm going to hear about it. And that's one of the first rules of business I learned from my dad and my uncle, and that is, 'inspect what you expect.'"

Forslund then shifted his presentation to the Norrie Cottages (patio homes) development. He explained that there would be a total of nine ADA compatible, single-story, patio homes constructed.

"Why are we proposing this idea?" Forslund asked, "As I mentioned, my wife and I are from the area. And most importantly, my in-laws have lived behind the school for -- I believe -- 41 years. We have friends and other acquaintances in the area. And again, this is an incredible building." He went on to say that the building, being constructed in 1917 was very well maintained. He said it's a landmark in the community and he said buildings are no longer built they way they were before. He told the crowd that he would like to see the building be preserved and given a new purpose.

"Who are we targeting to use this building?" Forslund asked,"Well, I will tell you that this -- in no way, shape or form -- is going to be a low-income project -- not the apartment homes and not the patio homes. We're looking at balancing the size of the units and the amenities provided, and that will determine the rental rates. Based on my research into the market, they're probably going to be at the top of the market. That doesn't say that they're not going to be affordable. But, we're going to market them to, let's say we have somebody coming in whose going to take a job at Grand View. They haven't sold their house yet. Or they want to live in the area for a year or two to decide if they want to buy or build."

"We're going to target to people that may have a house right now that they want to either downsize or if they want to take one of the larger apartments (there's a number that are over 1,700 square feet) but they don't want to deal with snow removal. They don't want to deal with yard maintenance. Or any other ongoing maintenance of a homeowner. And, maybe they want to be away for a few months during the year, and have the peace of mind that you can lock the doors, leave for six months, and you know that everything will be fine."

Forslund also said he envisions targeting professionals for the complex. He pointed out that the current mortgage problems in this country make it more difficult to purchase a home, but the proposed apartment "homes" would serve that need. He explained that his father, Clarence, passed away approximately 15 years ago, and he said if something like his company is proposing was available to his mother at the time, she probably would have moved there instead of staying in her three story house.

According to Forslund, the renovation of the school building will cost approximately $1 million dollars. The construction of the senior cottages will be approximately $990,000, and based on figures Forslund was able to gather through City Manager Scott Erickson, the project would garner approximately $74,000 in real estate taxes annually. $18,000 of those taxes would go to the school district.

EDITOR'S NOTE: I was sitting next to City Assessor/Building Inspector Dennis Hewitt during the meeting. I asked him if the figures Mr. Forslund were accurate, and he confirmed that they were. Since the property would be commercial rental, it would be non-homestead property and school taxes would be paid. I also asked Mr. Hewitt if he Smet Construction has asked the City for any tax breaks, subsidies, or government money. He indicated that no requests have been made to his knowledge. I asked Mr. Hewitt if the company could receive Brownfield Redevelopment funds for asbestos abatement or other costs, and Hewitt indicated that funds may be available, but no requests had been made up by the company.

Forslund explained that his company is a development company -- not a construction company. It doesn't actually build its projects, it finances them. All construction would be shopped out, and local contractors; subcontractors; and material suppliers would be used. He said a project of this size would be a big boost to the area economy. "So when you're talking about electricians or plumbers or any other service that we'll be looking at, we will be looking to bid locally. Also, when you look at buying your materials and supplies, given my last name, you can pretty much guess who I'm going to target to provide the lumber and building materials -- or the family reunions are not going to be fun!"

Forslund told the Board that the same purchasing policy applied for the appliances that will be purchased for the proposed project. He explained that he learned a lesson from his parents at an early age, "Whenever you have the opportunity to by local, you do, because that's where the economic benefits are recognized the fastest."

In closing Forslund pointed out that he, his wife, his family and most of his wife's family attended Norrie School. "I'd much rather see this building redeveloped than an empty lot that is not going to necessarily generate the same or better impacts." Before opening the floor to the public, he stressed two points: (1) he repeated that the "neither portion of the project" (the school apartments or the patio homes) would be low-income; and (2) he reminded everybody that his company's offer to the school district included language that "held the developer's feet to the fire" on the project. According to Forslund, the language in the offer gives his team of developers two years from the time of closing on the land to make the project happen. "If we have not completed the development within that two year time-frame, the entire property will go back to the school district, so that they can do what they are doing now. For us, that's the worst case scenario, but we wanted a safety net so that we couldn't control the property -- not develop it -- and then sell it to somebody else for some other purpose."

"Our team has the financial whereabouts to do so," Forslund explained, "We've got the construction and development expertise. So we're confident that if we move forward and get green lights along the way, this will be a spring 2011 construction start." He went on to say that his first discussion of the project with the School Board with on September 27th in closed session. He said that Board had received another offer to purchase the property that week, but the offer didn't include any detail regarding the purchase. "I am a proponent of clear and effective communication. So out of respect to the Board, because this is a big item to decide, I wanted them to hear it from me, representing my development group, what we were proposing to do; why we were proposing to do it; and what we preceived the benefits for the project. At their direction, we're having this public meeting tonight. And it's to accomplish the same thing. You're hearing it from the source answering those three points."

Board President Steve Thomas then opened the floor to the public for questions, comments, and concerns. He asked all citizens to stand and state their names before posing their questions or making their comments.

The first to speak was Dave Bulinski. He explained that he lives behind the Norrie School. He said he backed the project "probably 1000 percent." He said he had to clear the air regarding a newspaper article that came out featuring statements by Jim Beckman. According to Bulinski, Beckman said in the paper that many of the statements handed out to the public regarding the project were not true. He said he personally handed out much of the information to the neighborhood.

"Jim, calling me a liar -- I don't like that at all!" Bulinski said, "That is not what it is supposed to be! And I don't know where you got your information from..."

Beckman interupted, "That'd be misinformation, Dave. You're not a liar."

"But you didn't get it from anybody else." Bulinski said. He went on to discuss a "land deal" that was casually discussed at the time of showing, that would allow for the construction of a garage. He also made it clear that the meeting was clearly posted in the paper for seven days and that everybody was invited and welcome to attend. He said Beckman was entitled to his opinion, and that he had a right to disagree.

Gene Clemens told the Board that he has lived in the neighborhood for 40 years. "To me, I think it's a fantastic idea!" he said. He cited savings in demolition costs; the tax revenues; and the increased asset to the community as reasons for his support of the project.

Mike Cerneski told the Board that he was a lifelong resident of Ironwood. He said he was 100% behind the proposal for the "simple reason" that he might be interested in moving out of his house and renting one of the units in the near future. "If anyone here can tell me where I can find a good apartment, bring up your point!" Cerneski said. "Because I know that, when my mother was still alive, we had to go into Wisconsin to get her a good apartment to live in."

He said he looked forward to not shoveling snow and having the freedom to leave when he and his wife wanted to. He said he currently lives in an area that was once proposed for an apartment complex that was never built. He said "All we have is a disaster over there -- empty land that they use for fill and it's a problem all the time."

Former City Commissioner Susan Toth addressed the Board. "I have lived in the Norrie area, just a couple blocks from here for the last 18 years. My husband is a lifelong resident of the Norrie area - his whole family -- we live in a house that his family built approximately 90 years ago. And so his family has been prominent in the area for a long time. I'm a license real estate Realtor in both Wisconsin and Michigan. I cannot tell you how many people I've worked with in rentals that I showed them what I had and their like, it was not what they were looking for. Professional people come from larger areas and they have a much larger quality, a much larger quantity of properties to choose from that we do not offer in this area. This would be an excellent, excellent opportunity for us to be able to bring in and retain professional people. Keep, like Mr. Cerneski, people who are looking for an apartment. We have lost people out of the area because they wanted to downsize -- sell their house -- they sell their house -- they can't find an apartment. The move to other areas that can survive that. An empty lot here would not add anything to our community. It would not add anything to this location. And we definitely do not want this to turn into another Newport School which is the reason you put in a demolition fund. The current school could well use the $200,000 with the current building project to help the kids to add equipment; to add additional education. And finally, our community is downsizing. We're losing tax revenues because of people moving out of the area. This is one wonderful way of adding water and sewer customers to help with our water bills and adding to our tax bases so that we have additional tax revenues to fund services for everyone in the City of Ironwood."

Margaret Celeski then spoke. She explained she's lived in the area for most of -- all but 18 years of -- her life. She explained that she previously lived in Chicago. She said leaving the area and returning here gives her a unique perspective on the City of Ironwood. She said in Illinois there was plenty of housing available. She said housing is lacking in the Ironwood area. "It was like comparing apples and oranges." She said referring to the difference in housing from Chicago and Ironwood. She went on to say that the proposal would be a "win/win" situation for everybody. She cautioned that people need to be more careful what they have printed in the Globe, "Because that paper goes everywhere." And all of the negative publicity about the area doesn't help the community at all.

Former City Engineer Blaise Erickson (father of Ironwood's City Manager) addressed the Board. He told the Board that he was a lifelong resident of Ironwood. He was born in 1936 in a house on Ash Street. He said he attended Norrie School from 1941 until 1950 and many of his friends and family also attended the school. He briefly listed several of the exceptional teachers that taught when he attended the school. He reminised about the "air raid" drills that used to occur on a regular basis during the second World War. He said he fully supported the proposed project and he would likely be a future tenant in the complex.

He had two questions for the developer, however. He asked if grass mowing and snow removal would be included. Chris Forslund indicated that those duties would be contracted out. He then asked if some kind of brass plaque could be erected on the site honoring the Norrie School. Forslund told Erickson that there is a "gallery" planned in schematics that would feature such a historic plaque, historical photos, etc.

Jim Beckman was then given the opportunity to speak. President Thomas said to Beckman, "I assume you wish to speak, Jim."

"You bet, Mr. Thomas, I've been waiting for over a week to talk!" Beckman responded.

Before Beckman questioned Forslund on the project, he asked a general question of the audience. "Can everybody raise their hand who's within say within 10 houses of Norrie School that's going to be affected by this -- their primary residence?" There was a show of hands.

He then asked Forslund, "Who is actually going to be the owner of this facility? Are you going to have deed to this property?" Forslund told Beckman that the development group was made up of four people -- Chad and Scott Smet, owners of Smet Construction, of DePere, Wisconsin, and two others which were not named. He said other investors may join into the project, as there have been people asking to participate. He said Smet Construction used to be primarily a residential builder, but have recently expanded to become developers of commercial and residential properties. He said the company currently manages over 1 million square feet of commercial property.

Beckman then asked if the entire ownership of the company was going to be absentee ownership. Forslund explained that he was from the area and that he was technically a property holder in Ironwood since he and his family hold title to his mother's home.

Beckman asked Forslund to clarify something regaring occupancy. He said the neighborhood was lead to believe that the facility was going to be senior housing only. Forslund told Beckman that the Patio Cottages would be targeted primarily towards seniors. He said the apartment "homes" would target anybody that's looking for "that type of facililty." He said the apartment units would range from 974 square feet to 1,780 square feet. "I will stress... NO LOW INCOME!" Forslund repeated.

Beckman pointed out that the complex wouldn't affect Forslund and the other investors as much as it will affect someone like himself who lives in such close proximity to the facility. Forslund said it would affect his in-laws; his friends; parents of his friends; and his family.

Forslund told Beckman that the Norrie School project only one of about $50 million in projects his firm was currently working on. He said, however, this project was the one he's most excited about because it was an opportunity to "give back" to the community.

Before asking his next question, Beckman made the following comment, "I'm a little disappointed that we're even to this point. If you lived within 50 feet of this facility, you'd probably be standing right where I'm at, talking to you, telling you, you'd be against it also! This is greatly going to affect my family. I'm most likely going to have to sell my property and leave this street. And ten years ago, when I moved here, I never could have even believed, Mr. Forslund, I'd be living this nightmare right now, that you and your father-in-law are creating right now. I'm a little disappointed in both of you, it is business. "

Beckman asked if the development group was going to get the existing school building and property for nothing. He then elaborated and asked for a dollar amount that was agreed upon to purchase the land and the building. He went on to say that he was 100% opposed to the plan if it isn't going to be strictly senior housing, and he suggested that anybody in his position -- being in such close proximity to the existing building -- would be likewise opposed. Forslund said his firm offered $100 for the property and building. He continuted by adding, "If somebody were to come up with a better way to spend $100 to buy this facility, that would serve the needs of the community -- as far as housing for professionals -- for people like this gentleman, for those who are saving up to be first-time homebuyers, and they can come up with as good or better of a project -- I would raise my hand and say 'Do it! Because that's the right thing to do!'"

Forslund addressed a concern of another audience member, "Will the apartments be affordable?" Forslund pointed out that his parents, at one time owned approximately 50 rental units in the area. He said he called around to see what the average rent for a two-bedroom apartment in Ironwood with similar amentities to what his firm would be offering, he discovered that going rates were between $600 and $640/month. Although he is still working on on the figures, he estimates that the rents for his units would be higher than that. He went on to say that people who currently own houses have to pay for snow removal; yard maintenance; and home maintenance. He said that it would make little sense to price the units so high that nobody could afford them.

Mark Pavlovich asked how long would it be before the project is completed. Forslund briefly outlined the steps required to get the project underway and completed. According to Forslund, if the School Board approved the proposal, the project would need to go before the City of Ironwood due to the fact that the property would need to be re-zoned to multi-family residential. He admitted he was uncertain as to how long that process would take, but he estimated that the process would take between a month and six-weeks. He said that the next step, after closing on the property, would be to have testing done as required by law. Most of the testing involves environmental issues such as asbestos and lead abatement. He said he hoped to begin construction as soon as the frost leaves the ground in the spring.

Lorraine Corcoran expressed concern that the apartments might be rented to college students. She explained that she lived directly across the street and she didn't want to have to go through the noise and other issues that could develop. Forslund explained that the screening process his company utilizes eliminates the chance of problems. He said credit reports are pulled. He also said college kids, more than likely will not be able to afford the rent in the units proposed. He said that students under the age of 25 would be required to have their parents sign the lease before they could occupy any of the units.

Brian Tousignant asked how the project would affect his property values. Nancy Zak asked Forslund if she could answer the question. She told Mr. Tousignant that she is a licensed Relator for ReMax Action North. She explained that she's be the transaction co-oridinator for the project from the beginning. It's important to note that she is not paid for these services. She said she's received many calls from concerned citizens that the project would lower their property values. She explained that values in Newport and near the J.E. Murphy building in Hurley have declined, but having a well-maintained complex such as the one proposed would, more than likely, have a positive impact on property values near the project. She pointed out that some people don't see a nearby school as an asset either.

"Basically your rent is going to be high end rent. What if you don't fill them? Is there any chance that you're going to lower your expectations and get subsidized income?"

"No." Forslund responded.

"Subsidzed housing?"

"No."

"Are we going to end up like the Hurley High School with junk cars parked out front?"

"That's a fair question," Forslund repsonded, "And again, keeping in mind my family's history with dealing with apartments. You're looking at the person who had to clean them when they would move out, paint them and all that. And I have to say, some people have more business living in a barn than they do living in an apartment."

He said, if need be, rents might get lowered, but expectations never would. The same criteria for renting would still apply, but -- if necessary -- rents would be adjusted to keep the units filled. He said he talked to the manager of the Central School and discovered that there is currently a waiting list of about 30 people waiting to rent an apartment there. He said he's "conservatively optimist" that he will have no trouble renting the units and keeping them occupied.

Dave Martin addressed the Board next. He explained that he managed the Ahonen Apartments. He said the idea sounded like a good one, however, he had some concerns. He said approximately 60 percent of his current tenants are 55 years of age or older. He said he was concerned that many of his tenants would simply leave their current apartments and move to the new units -- leaving empty units there. "What's going to happen to our place?" Martin asked, "For the people who have homes and are talking about selling them, there's houses all over the place that can't sell. Down the line, it's going to be more for the City to tear down. They say there's no apartments. Look in the paper! I think I've seen seven or eight apartments advertised now."

Martin said it would be nice to have brand new apartments in Ironwood. He said Ironwood needs jobs more than anything. He suggested that the investment firm consider investing in something that would create jobs in the community.

Brian Tousignant asked if the developers would do the project if they weren't getting the building and property for $100. Forslund said that the numbers have to work out on any project, and he said putting nearly $2 million in to the property -- saving the school demo costs -- and contributing to the general real estate tax fund by paying full taxes makes the property a winning situation for the Schools; the City; and the residents.

Jeff Skovera explained that he's lived in Norrie for 47 years. He said he's been a contractor in the area for 11 years. He said he's done work in nearly all of the apartment buildings in the area. He said Ahonen Apartments are in good shape. He said, however, that a lot of apartments in the area are not fit to live in. He said a lot of the houses for sale currently are not fit to live in as well. He said most of them deserve to be torn down.

Thomas Mott said he lives in Jessieville. He briefly described the poor condition of the Newport School building to the Board. He said the purchase price is really irrelevant due to the fact that acquiring the property was saving the School District $220,000 because they wouldn't need to tear the building down. He went on to say that he was very pleased with what the area is doing with the schools. He said selling Norrie School and having it generate needed tax revenue was another good step to improve the school system in the area.

Jim Beckman said many of the people who supported the expansion of the high school did so with the understanding that the Norrie School would be closed and razed. He said it's not fair to sell the building for basically nothing and "give Mr. Forslund a blank check" to do what he wants with it. He suggested that the taxpayers are now paying higher taxes and that money should be returned to them.

President Thomas was quick to respond to Beckman's comments. He said that the bids for the expansion project came in $1 million under expectations. He also stated that, because of Stimulus Funds, the School was paying only 3/4 of a percent interest. He said that both of these savings were significant. He said that projects the Board has been earmarking are all long-term benefits to the District. These benefits will benefit the Schools and the taxpayers alike.

After a few of the Board members weighed in on the situation, the public hearing portion of the meeting was adjourned. Most of the audience left the room, and the rest of the meeting continued.

The Board unanimously voted to hire a Library Media Specialist, Deborah Ely and to pay; Part-Time Extended Hours Library Teacher at L.L. Wright and Sleight. Grant money is used to pay for this hire.

The Board unanimously voted to hire Thomas Mott (pictured in the last photo below) as the new Junior Varsity Basketball Coach as well.