Click below to hear the executive session in its entirety.
During its regular board meeting on Friday, Nov. 17, the Pagosa Peak Open School (PPOS) board of directors entered into executive session.
Citing Colorado Revised Statute (C.R.S.) 24-6-402(4)(b) and (4)(e), part of the Colorado Open Meetings Law (COML), board president Ursala Hudson moved the meeting to executive session, also citing “contractual issues.”
Mark Weiler, the owner of the Parelli building, which PPOS rents for its school, sat in on the executive session, along with PPOS school director James Lewicki.
An executive session is statutorily allowable only under certain circumstances to discuss confidential matters.
C.R.S. 24-6-402(4)(b) states that an executive session may be held for “Conferences with an attorney for the local public body for the purposes of receiving legal advice on specific legal questions.”
C.R.S. 24-6-402(4)(e) states that an executive session can take place when “Determining positions relative to matters that may be subject to negotiations; developing strategy for negotiations; and instructing negotiators.”
In a later email to SUN staff clarifying the purpose of the executive session, Hudson wrote that the purpose for the executive session was for the PPOS school board to get advice on a possible facilities expansion.
According to the COML, prior to an executive session, the following should be provided: “identification of the particular matter to be discussed in as much detail as possible without compromising the purpose for which the executive session is authorized.”
Following the meeting, The SUN contested PPOS entering executive session due to improper use of statute, sending a Colorado Open Records Act (CORA) request to PPOS to obtain the executive session recording.
The CORA request stated that the board cited 24-6-402(4)(b), despite there being no attorney present or included in the executive session.
The board also cited 24-6-402(4)(e) even though Weiler, the owner of the building, was included. Negotiations may not take place in executive session.
The board denied The SUN’s CORA request, with The SUN asking for the board to reconsider stating in an email that the topic specificity requirement as provided for in the COML was not followed by the PPOS board of directors when entering that executive session.
At a special meeting held by the board on Tuesday, the executive session was released to The SUN.
“We held an executive session last meeting, which the reason for entering that executive session was improperly cited in the agenda and we did not enter that session with a sufficient explanation of why we were entering that session,” Hudson said.
“I’ll make a motion to release the recording to the media,” board member Bill Hudson said.
Board member Tom McCullough seconded Bill Hudson’s motion.
Ursala Hudson stated that after discussions with Brad Miller, the board’s lawyer, that she, along with Bill Hudson and Weiler, felt comfortable releasing the recording.
“If we felt that nothing was too revealing in that recording, which none of us did, that it was probably best to do so since we did not use the right citation in our agenda and since we did not clarify what the executive session was for, we should give it up,” Ursala Hudson explained.
“What’s in the agenda is not necessarily binding. If the chair thinks there should be a different reason for the executive session and that’s announced publicly, and reasons are given for it, that’s a legitimate reason to go into executive session, if the board votes to go into executive session,” Bill Hudson added.
What the chairman says, or whoever makes the motion to go into executive session, is binding on the board, Bill Hudson clarified.
“It has to be done exactly right. And I don’t think it was done exactly right,” Bill Hudson noted.
“Yeah, I couldn’t recollect whether it was or not, but I had that feeling myself,” McCullough added.
The board then moved to approve the motion to release the executive session to the media.
The motion carried unanimously.
Within the executive session, the board, along with Weiler and Lewicki began to discuss a potential facilities expansion for the school.
As the executive session began, Lewicki started by explaining why the executive session was being held.
“I’ve asked to come into executive session because the discussion has a very big potential in a contractual type of arrangement,” Lewicki said.
He added, “As your school director, in the last couple of weeks, there’s been some development and potential. So, I want to give you what’s crystallized so far and then ask for your direction how you would like me to kind of proceed from here.”
Bill Hudson then stopped Lewicki and asked if the information was pertaining to negotiations regarding to the Parelli building.
“It concerns a donation by me. An accommodation, a financial accommodation that will ultimately work towards the building,” Weiler added.
“I would have done this in your general meeting. It makes no difference to me,” Weiler said.
Bill Hudson then asked if the undisclosed matter could be approached in an open meeting.
Weiler agreed he was comfortable with Bill Hudson’s request, while Lewicki offered his thoughts.
“I’d rather that the board know what this is and let the board make that conversation. You’re preempting the information,” Lewicki said.
Lewicki then went on to explain that, with this kind of information, an executive session was held so the board could deliberate and move forward.
“It’s much bigger than buying the building,” Lewicki said.
The potential of buying the building is now on the table, Lewicki added.
In the last few days, Lewicki explained, there is the potential for buying the Parelli building with the “K-16 campus.”
“There’s real money here, of a million dollars to help facilitate this group as down payment to purchase the building,” Lewicki said.
There also are possibilities of tenants who could occupy the second floor of the building, Lewicki added.
Those tenants, as PPOS moves forward, according to Lewicki, in the short-term could be paying $15,000-20,000 for most of a monthly building payment.
Lewicki mentioned that he had some conversations with the Walton Family Foundation about PPOS and went on to state that the Walton Foundation looks at PPOS as being a “rural pilot.”
The Walton Foundation would like to have four pilots in the state of Colorado. Two in Denver, one in the suburbs and one in a rural area, Lewicki explained.
“If this materializes they would be willing to support us,” Lewicki said.
Lewicki stated that PPOS will continue with the K-8 project-based elementary school, but there is the potential for a high school.
One of the visions for PPOS is to have a campus that is a learning center for the community, Lewicki noted.
Colorado Mountain College (CMC) could be involved in this transition, Lewicki added.
“The Walton folks, they like what we’re doing pedagogically with the school, but they’re looking to see, ‘Can you make this work for a community?’” Lewicki said.
Lewicki closed out his statements by saying he had thought about presenting the information “one to one” but decided against it in favor of an executive session.
“I said, ‘nah, I think we just bring it to a session because there’s a lot of contractual — there’s a lot of different pieces here,’” Lewicki explained.
McCullough then asked if there was a plan to remodel the facilities in addition to purchasing the building.
“I mean as your school director, if we bought the building, then part of the idea would be, how is it best used? So, let’s call it light remodeling,” Lewicki responded.
The building itself is set up as an educational place, so there is not heavy remodeling to be done, Lewicki added.
County and school
district usage of building
Weiler then added to the conversation by stating that the county considered using the Parelli building as a justice center.
“And when it didn’t, it was like, ‘I’d rather it be a charter school anyway. I think that’s going to be a lot better for our community, so we went with that,’” Weiler said.
Weiler went on to state that Archuleta County Commissioner Ronnie Maez called him and asked if the Parelli building was still for sale.
“I said, ‘Well sure, but come on, Ron, I got a tenant here, this is the future of our community,’” Weiler said.
Weiler went on to add that Maez proposed that the county lease the second floor of the Parelli building for administrative offices.
It was then described by Weiler that, at a public meeting, the amount to lease the second floor was presented to the county commissioners.
“Twenty-three thousand dollars to lease the upstairs. That’s the same rate that you guys [PPOS] pay, per square foot,” Weiler said.
It was also mentioned by Weiler that the county would only do it for two, three or four years.
“They’re going to put the seat of county government in Harman Park. That’s what they’re going to do, but it’s going to take some runway to do that,” Weiler added.
“In the end, if they [the county] walk in here with a bag of money, they’re going to own it,” Weiler said.
Weiler then went on to mention that business owner Marc Katz and community member Jack Searle would contribute collateral toward the loan on the Parelli building.
Searle’s contributions would be some of his mineral rights, Weiler clarified.
“I really don’t want to sell it to the county. Frankly, Linda Reed [Archuleta School District (ASD) superintendent] was in here and said ‘Why don’t we do an elementary school here?’ Now, it shouldn’t be,” Weiler said.
The capacity problem at Pagosa Springs Elementary (PSES) should have Reed thinking of expanding PSES, Weiler noted.
“And I have said this, I have given them props that they don’t deserve about having the courage to agree to allow you to create a charter school. Because if they hadn’t, these kids would be in the hallways and the bathrooms over there,” Weiler said.
The lack of vocational and building-trades programs at Pagosa Springs High School was then discussed by Weiler.
“There is no building-trades, anything, in our high school. There’s nothing. There’s nothing vocational in there either. Zero,” Weiler noted.
Weiler then recounted the process of getting the ASD Board of Education to allow the use of ASD property for a potential vo-tech expansion.
It was then described by Weiler that billionaire Sid Bass and builder’s committee member Larry Ash corresponded to acquire the money for a building-trades building.
“And Sid said to him, he said,“Get a building-trades program, we’ll give you the money to build the building.’ And I said, “Are you sure about this?’ and he [Ash] said, ‘From his mouth to my ears.’ That’s good enough for me,” Weiler explained.
Additionally during the executive session Weiler recounted the story of how he was introduced to CMC, which has been discussed in various public meetings.
Weiler then went on to describe the various amounts of public support he has gotten on the CMC idea, even mentioning Pagosa Springs Mayor Don Volger.
“I’ve had Don Volger hug me. Hug me. Since my presentation, every time he’s seen me,” Weiler said.
Weiler went on to commend Volger for being a nice guy, but noted that Volger is “intimidated by people who understand how to do something he doesn’t understand how to do.”
It was then noted by Weiler during the executive session that he is looking to make an impact on the community of Pagosa Springs.
“I’m looking for some significance. I’ve told people that I’ve had lots of careers, made lots of money, but none of it really had any significance,” Weiler said.
Weiler then commended the PPOS board.
“But, I think you guys had a vision for excellent education of kids. And I think you’re the role model of the future,” Weiler explained.
Based on various school board meetings Weiler has attended, he explained that ASD’s board is also thankful for PPOS as well.
The million dollars, as described by Weiler, would be a security interest that the bank would hold. And if PPOS does not meet its financial obligations, the bank takes the money.
The sale price of the Parelli building is $4.735 million Weiler clarified.
PPOS financial stability
Ursala Hudson then added that, while the discussion fits what the founding PPOS board members originally envisioned when they started the school, she felt nervous about the financial stability of PPOS.
“I’m feeling really nervous about our school financially right now, and we can’t afford, as far as I know, to pay our business manager to work full-time,” Ursala Hudson said.
Ursala Hudson said that even the fundraising goal of $25,000 that was set by the PPOS board has not been met.
“We’re already a quarter of the way through the school year and we’ve raised, like, a few hundred dollars,” Ursala Hudson added.
The start-up expenses were also more than the board had projected, Ursala Hudson added.
Board member Chenni Hammon raised the issue of security risks for the students of PPOS if the county were to lease the second floor of the Parelli building.
“There’s a simple way to do it. You segment off the lobby,” Weiler said.
Weiler also added that Lewicki had mentioned utilizing a secure entrance for PPOS.
Ursala Hudson then revisited her point on PPOS’s financial security.
“But, like I said, the No. 1 reasons why schools fail is because of finances. I’m not concerned about our test scores and if we don’t do well within three years according to state standards,” Ursala Hudson said. “Financially, that’s really the only reason why we could fail.”
Weiler responded by saying that PPOS’s model is “scalable.”
The worst-case scenario for PPOS is for the county to purchase the Parelli building and not renew the lease, Weiler mentioned.
“I don’t think we would be open without this building,” Ursala Hudson said.
“You wouldn’t,” Weiler responded.
A suggestion was made by Weiler to the board to acquire home-schooled children to attend PPOS.
“My point is, go and embrace those folks. And you tell the current parents and your students, ‘Look, if this thing is going to be successful, we have to get past 70 kids,’” Weiler said.
The current plan is to grow a grade at a time to get to 135 students, Lewicki said.
“But, can we get there quicker? If you get there quicker by marketing home school and the other pieces, there’s some pretty significant funds,” Lewicki added.
The executive session then moved back to a discussion on CMC potentially coming to Pagosa Springs and the finances behind it.
“They don’t have, and I’m not being rude, but neither the county nor the school district has real financial people. They have bookkeepers. And you got to have them, but they’re not real financial visionaries,” Weiler said.
More advice was then offered to the PPOS board by Weiler.
“I would find another 70 kids in this community and I would have them sign up in January or February,” Weiler said.
Changing the charter agreement
Bill Hudson then acknowledged that it was a great idea, but PPOS has a charter with ASD, and PPOS has to get the OK from ASD to change its model.
Lewicki then responded that PPOS and ASD could work together in regard to the charter agreement.
“The fact that they capped our enrollment, really is not the way it works in Colorado state law,” Lewicki added.
Hammon added that the PPOS board knew it at the time.
“It was just something we were conceding to just to get through the process,” Hammon said.
Lewicki also added that PPOS will benefit from being located uptown.
“This is uptown and this is a neighborhood, it’s going to boom really quick,” Lewicki said.
Bill Hudson then finished his point that part of the discussion will still have to take place with ASD.
The PPOS board would have to show ASD its new plan and ask if it can redo its charter, Bill Hudson explained.
“That opens the charter up to be revised by both parties,” Bill Hudson added.
The conversation would need to take place as soon as possible so it can be part of ASD’s consideration as it pursues the BEST grant in February relating to potential upgrades to ASD facilities, he explained further.
“If we’re going to expand, that’s going to reduce their [ASD] need for new buildings,” Bill Hudson explained.
Bill Hudson then suggested that the board meet with Reed in order to discuss the consideration.
Lewicki added that there are a lot more details that need to be gathered.
“Because it is a community initiative and how does it kind of interact at different places? And now it does have that potential,” Lewicki said.
“There’s a legality that says that charter schools can’t own things, so we would have to have a parent company,” Hammon said.
“Well you have a building corp. We create a building corp that owns it and we lease to the building corp,” Lewicki responded.
Ursala Hudson then added that in her biggest concern is PPOS’s foundation.
“I would like to know that the Walton Foundation, the first chunk of that money, is going towards another teacher for first and second grade, our full-time business manager and a custodian. Because those are three main positions that are really putting strain on our school,” Ursala Hudson explained.
Hammon then asked Weiler a question regarding the use of Katz’ and Searle’s money.
“Is that going to be the down payment for the building or is that just like a security deposit that you intend to get back?” Hammon asked.
“The bank will require a security interest in those financial instruments. That if the business enterprise fails they will take those instruments,” Weiler responded.
“It’s not a grant,” Weiler added.
The PPOS board would still need the full $4 million, Weiler clarified.
Lewicki then added that the PPOS board could convene a working group on just the fiscal aspect of things.
Hammon then asked if it is legal for PPOS to rent to ASD if ASD decides to rent some space upstairs for its administrative offices.
“Because they have a trailer, they obviously would want to move here if they had a chance,” Hammon said.
If ASD were to buy the Parelli building, Ursala Hudson noted that PPOS could not pay rent to ASD.
“We can’t. It’s illegal for charter schools to pay rent to their district, so they probably wouldn’t,” Hudson said.
Weiler also suggested that PPOS become “the master of its own marketing.”
The price tag
The conversation during the executive session then turned to the space and price tag of the Parelli building.
“Would Parelli want to lease back some space?” Hammond asked.
“If we stay here, sure. I mean, whatever we’re going to do, we’re going to do it,” Weiler responded.
“In my mind there is no way we’re out of this building before next September,” Weiler added.
“Are you negotiable on the $4.7 (million)?” Hammon asked.
“No,” Weiler responded.
The entire recording of the executive session can be listened to by going to The SUN’s website, pagosasun.com.
The above story was updated on Nov. 30, at 2:20 p.m., to correct a quote.