The Cullman County Commission on Education today authorized Dr. Shane Barnette and the Board President, Shane Rusk, to enter into an agreement to sell property on Smith Lake.
The property, which the Board purchased in 2014 for $1.2 million, will be sold to a developer for $2.9 million. The adjacent Section 16 Land will also be sold to the developer for $13.2 million. The combined sale price for the property purchased in 2014 and the Section 16 Land equals $16.1 million.
A voter-approved amendment to the Alabama Constitution in 2012 gave control of Section 16 Lands to the Board of Education. That amendment established strict guidelines for the distribution of proceeds resulting from a future sale.
- 10% of the $13.2 million Section 16 sale will be deposited into the general fund.
- 90% of the $13.2 million Section 16 sale will be deposited into a trust fund, with annual interest payments to be deposited into the general fund.
- A portion of the 10% initial funds and the annual interest payments will be allocated with Cullman City Schools, as required by the act. The distribution percentage will be calculated every five years based on the existing enrollment of students in each system, adjusted by the number of students enrolled in the system who reside outside the system.
The 2014 purchase of land for $1.2 million that is adjacent to the Section 16 property is solely owned by the Cullman County Commission on Education, and those proceeds ($2.9 million) will be deposited into the general fund of Cullman County Schools.
Both Dr. Barnette and the Board preferred the land to be purchased by a buyer who would use it in a way that would continue to benefit our students and the school system for many years to come. This transaction will generate revenue in four different ways:
- The initial sale
- Annual interest earned
- Sales tax generated during the development of homes
- Annual property taxes
The initial plan for the land sale proceeds is to use the funding for capital improvement projects.
The following statements can be attributed to Dr. Shane Barnette, Cullman County School Superintendent:
“Over the past several years, the citizens and stakeholders of our community have expressed a desire to both me and the Board for our school system to move forward on the sale of the Section 16 Land to benefit our current students and those to come. Over the course of the past five years, we have intentionally worked to be diligent with the ownership of the land and explore the best way in which we could be good stewards of this property. Our goal has always been to use the Section 16 Land to bring positive change while generating the greatest return for students.”
“While highly controversial, the decision to purchase the adjacent property to the Section 16 land over six years ago ultimately turned out to be a wise investment. In 2014, that property was purchased for $1.2 million. The sale of the property today comes to $2.9 million and has also allowed us to secure a buyer for the adjoining Section 16 Land.”
“The revenues generated by the sale of the Section 16 property and the adjacent land owned by CCBOE, will be applied toward ongoing district-wide projects that include but are not limited to; updating HVAC systems, modernizing buildings to offer state-of-the art technology, much needed improvements at the local schools, and security measures to ensure the safety of our students.”
The following statement can be attributed to Shane Rusk, Cullman County Commission on Education President:
“This is the right time to make the most of this land to benefit Cullman County Schools. The way this sale is structured will not only make immediate funds available to our system for much-needed upgrades, but will also provide benefits long-term.”