Denver Public Schools’ $12.5 million purchase of the former Food Bank of the Rockies warehouse in Montbello is already rippling through the district’s real estate portfolio. To help cover the cost, the school board is preparing to plug Pascual LeDoux Academy into a 2020 lease-purchase financing package so that an administrative site on Yuma Street can be sold. That seemingly dry deed swap now sits at the crossroads of long-running questions about DPS’s Certificates of Participation and a lawsuit aiming to unravel parts of the district’s lease-financing setup.
Board to consider deed swap
The DPS Board of Education is slated to vote on a deed swap that would remove the Yuma administrative property from the 2020 lease-purchase structure and replace it with Pascual LeDoux Academy, clearing the way for Yuma to be put on the market, according to The Denver Gazette. The outlet reports that the move is designed to help offset the $12.5 million price tag for the former Food Bank of the Rockies facility, with additional money for upgrades coming from existing bond reserves.
Why DPS bought the former food bank
District leaders say the roughly 103,000-square-foot building at 10700 E. 45th Ave. will serve as a consolidated food-services hub and central freezer facility that can support about 11 million school meals a year, according to BusinessDen. The Food Bank of the Rockies’ move into a newer and significantly larger distribution center in Aurora late last year opened the door for DPS to purchase the Montbello site. CBS Colorado reports that the district expects the hub to be up and running by the next school year and that consolidation could trim leasing expenses while chipping away at deferred maintenance.
How the COPs structure complicates the sale
The real estate shuffle sits inside a complicated financing web. Under DPS’s structure, the district transfers titles for some facilities to a leasing corporation, which then sells Certificates of Participation, while the district makes lease payments to keep using the buildings. The latest district audit shows about $784.6 million in outstanding COP principal, a figure that has stoked scrutiny, reporting, and legal challenges, according to Colorado Politics. Critics argue the arrangements can sidestep voter sign-off and ultimately saddle the district with higher long-term costs.
Legal questions
Parent group Mamás de DPS has gone to court, asking a judge to declare the leasing scheme unconstitutional and to return titles to buildings it says were improperly transferred, according to Mamás de DPS. At the heart of the case is whether the Denver School Facilities Leasing Corp. counts as a public entity, a finding that would determine whether Colorado’s constitutional limits on public debt apply.
Community reaction and union concerns
Teachers and some parents say the property swap is yet another sign of how much financial pressure and confusion the district is under. Local coverage of DPS’s benefits and budget fights has highlighted union anger over proposed health plan changes and warned that shifting more costs onto employees risks deepening distrust, as reported by Hoodline in coverage of the benefits battle, where school staff fume as the district moves to ditch Kaiser. Community advocates acknowledge that a centralized food hub could streamline service for students, but many are pressing for clearer explanations of how the purchase will be financed and how existing school assets will be kept out of harm’s way.
What comes next
The board can approve the substitution, tap the brakes to seek more detail, or ask staff to pursue different financing options. Any sale of the Yuma property is intended to help balance the books on the Food Bank building purchase and tackle some deferred maintenance. BusinessDen noted that district officials framed the acquisition as a long-term cost saver for food services, but with the COPs structure looming in the background, the upcoming vote is likely to be judged as much on its financial engineering as on its facilities planning.
