In addition to securing the purchase of its real estate, the board of Laurel Street School and Family Center was recently able to build a new playground. The playground was funded with a $10,000 grant from the Temple Hoyne Buell Foundation and an equal amount of matching funds from local donors.
Steamboat Springs A community institution that has served scores of young families, Laurel Street School and Family Center, is on the path to a more secure future this winter. The nonprofit preschool's board of directors was recently able to purchase its downtown real estate for $750,000.
"This was a big win for us," said Laurel Street Board Chairman Dave Moody. "If this hadn't worked out, I don't think we could have afforded to stay there. We had looked for a different location and couldn't find anything."
The preschool, at 582 Laurel St., is immediately opposite the construction site for the new Soda Creek Elementary School. For years, it has offered a convenient alternative for parents of children attending a half-day of kindergarten, as well as pre-school-age children.
"It's a great facility, and (executive director) Kim Keuber does a great job," Board Secretary Norbert Turek said. "There are a lot of people in town who feel a connection to Laurel Street School."
However, the ability of the school to continue with its current business plan was in doubt as the board adapted to changes in the ownership of the real estate.
The board of the nonprofit entity acquired only the business from previous owners Don and Susan Teuton seven years ago, Turek said. They signed a 15-year lease with provisions for escalating monthly rental amounts, but the Teutons never invoked those increases, Turek said.
Almost a year ago, a limited liability company controlled by California businessman L.D. Christiano acquired the real estate from the Teutons. Christiano announced his intention to invoke higher rents spelled out in the lease.
An increase in rent from a monthly $4,000, plus property taxes, to about $4,800 plus taxes would have necessitated raising daily student fees above the current level of $50, Turek said.
Keuber said the school has 43 students, most in a part-time program. The full-time, daily fee went up $4, from $47, in September. Parents of full-time students who attend the school an average of 20 days a month would pay $1,000 a month.
Moody and Turek agreed that affording the increased rent would have meant raising student fees by another increment larger than the $3 increase instituted three months ago.
Instead, the board resolved to attempt to purchase the property from Christiano, who had expressed his wishes that the school would be able to acquire the property, Turek said.
Christiano was represented by Steamboat attorney Mark Steinke in the transaction. Board members, including Turek, provided professional services and waived their fees.
"Mark (Steinke) was really great to work with on the deal," Turek said.
Turek said the board of directors pursued a pure commercial loan and a low-interest loan from the Colorado Housing Finance Authority, but struggled to qualify for either one.
"We could have (pulled off the purchase) with a rate increase, but we just increased rates in September," Turek said. "Laurel Street has fine cash flow, but no assets."
Ultimately, the board settled for a loan from Alpine Bank for a portion of the $750,000, plus some private financing.
The new mortgage payment is on par with the old rent payment.
Ultimately, Turek said, the board would like to increase its equity in the property and its financial strength to the point that it can qualify for a fixed-rate, low-interest loan with CHFA.
Turek said having a strong board of directors was critical to pulling off the complicated purchase of Laurel Street School's real estate. In addition to his 25-plus years in real estate and Moody's background in human resources, board members include attorney Dave Nagel of Feldmann Nagel & Associates, and certified public accountant Allison Kusy of Tredway, Henion, Palmquist and Kusy.