The Fort Wayne Urban League board says it supports efforts to create a new charter school under its leadership, provided the non-profit isn’t at risk of losing its building if the project goes bust.
At a tense board meeting Tuesday, board members gave President Jonathan Ray permission to move ahead with financing for the Thurgood Marshall Leadership Academy. But under no circumstances, board members said, could the deal allow for the Urban League headquarters to be seized as an asset.
The headquarters at Hanna and Creighton streets was built about eight years ago for $3.5 million, Ray said. He put the value of the current building at about $3 million.
The Urban League hopes to start an urban prep school in the former Village Woods Middle School in southeast Fort Wayne. The Urban League would oversee the school, which would be run by education management company American Quality Schools.
Members of the charter school board have spent the past several weeks discussing ways to finance the school. They hope to enter into an agreement with Equity Capital Partners LLC, a locally based venture capital company that will buy the building for about $170,000 and renovate it for $1.2 million.
East Allen County Schools owned the building before selling it to Ralph White, who founded White’s School of the Arts Community Developmental Programs before running into financial and legal problems. The building is now owned by Salin Bank.
The plan for now, board members said, would be to enter into a 10-year lease agreement with Equity Capital Partners LLC. The agreement would stand for at least six months until another entity called the Charter Schools Development Corp. could buy out Equity Capital.
The Charter Schools Development Corp. is a non-profit Community Development Financial Institution that lends money to charter schools across the country, according to its website.
Will Clark, Thurgood Marshall Leadership Academy board president, said he had been talking to the group for the past two weeks and was convinced it could provide more affordable long-term financing than Equity Capital.
Urban League board members said they supported the school but raised concerns about the Urban League’s liability if the charter school were to be closed by the state and therefore unable to make its lease payments.
In December, the Indiana State Charter Schools Board granted the Urban League a five-year charter. The board reserves the right to remove the charter depending on the school’s performance.
“Anybody here who thinks there isn’t risk should be disabused of that notion,” Clark said at the meeting. “There is risk.”
In a unanimous vote, the Urban League board agreed to let Ray move forward with a deal with Equity Capital, provided it met certain conditions.
In addition to taking the Urban League headquarters off the table, they said the agreement must allow the Urban League to bow out of its agreement with Equity Capital without penalty if another group wanted to take over the financing.
If Equity Capital didn’t agree to such terms, Clark said, he understood the only choice was to walk away and risk the start of the school.
Equity Capital Partners, LLC is an investment vehicle of Equity Investment Group, which was founded by Fort Wayne resident George B. Huber. Equity Investment Group, headquartered in Fort Wayne, is considered one of the largest private real estate investment trusts for shopping centers in the nation.