ELYRIA – Elyria Schools officials and the owner of Midway Mall reached an agreement this week on the amount of money the school district should receive from property taxes on 47 acres of mall property.
In short, the deal will give the school district an additional $1.1 million in payments from Centro Watt for 2006-08.
The district plans to use the additional money to enhance the new Elyria High School with green building elements, the costliest of which would be the installation of a geothermal system that regulates heating and cooling, said Amy Kren, Elyria Schools` spokeswoman.
Centro Watt`s Midway Mall property, in turn, will remain valued at $44 million – at least until the next property tax revisions in 2009.
The school district and Centro Watt – which purchased the mall last year – were at odds as to the actual value of 47 acres at the mall, which included an area near JCPenney, the movie theater and other stores on the periphery of the main structure.
Before reaching the agreement this week, school officials had said the county auditor`s assessed value of $44 million was too low on the 47 acres. They argued that the property should have been valued upwards of $89 million.
With the property`s value sticking at $44 million, the school district will continue to receive about $577,000 a year in property taxes.
If the value of the 47 acres were to have been hiked to $89 million or more, the district could have collected as much as $1.1 million a year, according to Chief Deputy County Auditor Linda Keys.
Fred Stephens, treasurer of Elyria Schools, said the payment from Centro Watt works out for the district because it won`t count as property tax revenue, which could have meant a reduction in state funding.
Elyria Schools tax attorney Tim Armstrong said the $89 million value for the 47 acres was a best guess by the district, and not necessarily a perfect representation of what the property might be worth.
“No one exactly said we`re going to prove what the value is,” Armstrong said.
Stephens said reaching the agreement with Centro Watt was preferable to any court action to reassess the property`s value.
“If we had gone to court, who knows what would have happened?” Stephens said. “We agreed to settle on this dollar amount and drop the complaint.”
For the three-year tax period in question, the district would have collected about $3.3 million had the value been upped to $89 million. Instead, it will receive $1.7 million – or $2.8 million with the additional payment amount figured into it.
The school district had been trying to find ways to pay about 60 percent of the $1.7 million estimated cost associated with “going green” at the new Elyria High School, since the state is willing to pay 40 percent.
“Obviously this comes at a good time,” Kren said. “That was money we would have had to come up with.”