Journalist Therese Jacob first published this in TapintoNewark.
The Newark Board of Education recently bought back a dilapidated school building in the city that the district previously sold for $650,000.
How much the district paid to get it back, however, remains a closely guarded secret.
The board refused to provide a settlement agreement it reached this year with the Hanini Group stemming from the 2019 sale of State Street School to the Newark-based developer.
State Street School, the oldest standing school building in Newark, hasn’t been used since the 1950s and is in disrepair. It was one of the unused facilities that Chris Cerf, the previous state-appointed superintendent, unloaded in an effort to close budget gaps.
Shortly after becoming superintendent, Roger Leon said it was his quest to make some of those buildings “unsold.”
Leon has apparently achieved that goal with State Street School — but at what cost only he, some staff, and school board members know. In other words, taxpayers are picking up the tab, but just don’t know how much.
TAPinto Newark has filed Open Public Records Act (OPRA) requests three times for the information and has been met with denials that range from “attorney client privilege” to “if disclosed, would give an advantage to competitors.”
Legal experts say the amount that Newark public schools paid for a building is a matter of public record.
“Settlement agreements and real estate contracts are public records — there is no disputing that and it has been the case law for many years,” said CJ Griffin, partner and director of the Stein Public Interest Center at Pashman Stein who specializes in litigation involving OPRA, a state law that governs the release of official documents to the public.
“The public deserves to see the details of this transaction to play an oversight role,” Griffin added. “Although there may be portions of the contract that require redaction, withholding it in its entirety is unlawful.”
The costs for State Street that are known are the legal fees involved in trying to buy it back. The district has amassed legal fees of over $1 million, in its quest to unsell the State Street building as well as the Maple Avenue School building, which it sold for $1.2 million in 2017. The school board voted during its March 2023 meeting to “partially settle” the costly litigation for the State Street building without disclosing the details.
The litigation stemmed from the superintendent’s decision to claw back the buildings from Hanini. The district filed suit in Essex County Superior Court in 2020 against the Newark Housing Authority, which had been commissioned to help sell the school buildings, as well as Hanini and Friends of Team, the charter school affiliate which purchased the Maple Street building from Hanini in order to open a KIPP school there.
The superintendent did not seek school board approval before launching the litigation, an issue that is also before an administrative law judge in New Jersey.
The Newark Board of Education’s law firm, Riker, Danzig, Scherer, Hyland & Perretti, raked in about half a million dollars in legal fees on the State Street case through last year — almost as much as the $650,000 sale price of the State Street building.
Riker, where Newark Board of Education’s general counsel, Brenda Liss, was formerly a partner, dropped out of the case in September of 2022, and was replaced in the State Street case by the law firm Sattiraju & Tharney, which is representing Newark public schools in the Maple case.
As of last summer, the Newark Housing Authority had spent over $200,000 to defend itself, while Friends of Team has also said it has spent over $200,000 in legal fees.
Compared with most Newark schools, State Street is tiny, with only eight classrooms and in such disrepair that when Newark Public Schools put it on the market for sale in 2017, it only got two offers — both under $700,000.
After purchasing the building through a limited liability corporation — 15 State Street LLC — Hanini planned to renovate it and then lease it to the Newark Public Schools Historical Preservation Committee for a museum and the Newark Boys Chorus School.
Plans were halted in April 2020 when the Newark Board of Education sued 15 State Street LLC and the Newark Housing Authority to try to reverse the 2019 sale.
Hanini Group has not responded to requests for comment.
A recent OPRA request from TAPinto Newark to the Newark Board of Education, to obtain the settlement agreement and see the purchase price, was submitted on April 24, 2023, and was denied by the district because the information would “give an advantage to competitors, is not a government record, and is not disclosable.”
“I’ve never heard of such a claim,” Griffin, the public records expert, said. “Litigation settlement agreements are subject to OPRA pursuant to the Supreme Court’s decision in Asbury Park Press v. County of Monmouth. That is not new case law, they should be aware of it.”
TAPinto Newark is planning to appeal the OPRA denials to the state’s Government Records Council.
As a law, OPRA was created to help support the public in its quest for transparency of government records and applies to all government agencies, including school districts.