Fate Of Silver Lake School Rests With Hearing Officer
May 17, 2018 at 5:24 p.m.
SILVER LAKE – After nearly three hours of testimony on the order to demolish the former Silver Lake Elementary School, Hearing Officer Thomas Earhart had a simple question:
Who owns the building?
Silver Lake Partners LLC was set up early on, he said, but it was dissolved. “So there was a period of time when there was no LLC ownership at all, until the new LLC was formed in February. ... Because the property was originally part of the original LLC that was dissolved, I’ve heard no testimony about whether the property has been made an asset in the new LLC. Can anybody enlighten me on that?” Earhart said. “Because if not, it reverts back to Mr. (Mike) Baur, he’s the owner.”
Baur is a member of the Silver Lake Partners LLC and is fighting the town’s efforts to demolish the old school. His attorney, Bruce Munson, said, “I don’t think by reason of being a member of an LLC he becomes the owner.”
Earhart said he thought there was a statute where Baur became owner as an individual because of the dissolution of his LLC and because the property wasn’t reinstated in the new LLC. Munson said he thought there was a statutory protection against that.
Earhart told Munson if he could find that, to send that information to him. Munson said he would.
Scott Reust, town attorney, responded, “The only deed that’s been recorded – unless there was some deed or transfer of asset otherwise, which real property can only be transferred by deed – was recorded in 2008 and that was transferred to Silver Lake Partners LLC 2008 entity. I don’t know who else could possibly be the owner without a transfer of that property.”
Earhart said he wasn’t in a position Wednesday to make a decision on the demolition. “I will do that in what I believe is a fairly timely manner because I know this is something of a concern to not only to the parties but to the town of Silver Lake as well,” he said.
He said he will notify the legal counsel of his decision.
After Earhart makes a decision, there will be an opportunity to appeal it through Kosciusko County Circuit Court within 10 days.
Reust told Earhart that the LLC was created as a domestic limited liability company Oct. 15, 2008. The partners purchased the property from the Winona Arts & Restoration Preservation Inc., with the warranty deed recorded Oct. 29, 2008.
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“Since Silver Lake Partners LLC has been owner of the building, there’s been numerous, unending complaints of the dilapidated building, unsafe structure and the uninhabitable building. The town of Silver Lake has had to deal with that on a regular basis for now going on 10 years,” Reust said.
He said Baur is the registered agent of the partnership and whom the town deals with, along with his attorney, Munson.
He said the town has made every effort to “hold (the partnership) to the promises they made at the time they became owners of the building, and none of that has come to fruition.”
Baur later said he never made any promises but had goals for what he wanted to accomplish.
Reust said the LLC was administratively dissolved in 2014 so there was some confusion as to who may be appearing for the LLC.
Munson said the LLC was reinstated in February, but Reust said that wasn’t true. Munson said it is true according to Secretary of State records. Reust said a new company was created and new articles of organization were filed, but it wasn’t a reinstatement.
Munson said he and Baur were there on behalf of Silver Lake Partners LLC, and Reust asked, “Which one?”
Munson said both the 2008 and 2018 LLCs.
Town Council President Chad Miner testified there’s been a number of complaints over the years about the school, including ongoing deterioration, birds or bats in the building and the building’s proximity to the park where children are present.
Miner said he was not on the town council when the partnership purchased the building, but the original stated goal was for it to become a charter school. He said in the shape it is now, he didn’t think it could be used for that.
In fall/winter 2016, Reust said the town hired Calvin Bolt to inspect the building. Miner said complaints about the school have continued since.
“As the condition of the building continues to deteriorate, and it continues to become increasingly unsafe ... I think demolition would be the appropriate way of resolving (the matter),” Miner said.
Munson asked Miner if the town ever presented a list of corrections that it wants with a deadline to the Partners. Miner said he believed so, and the inspection report prepared by Bolt listed the various issues with the building. Miner said the town’s position now is that the issues need resolved “immediately.”
Munson said Bolt’s report did not recommend demolishing the building. Miner said Bolt did say the cost of repairing the building would be greater than its value.
Miner read a portion of Bolt’s report: “The building is sort of an albatross. Maybe before the roof started leaking, creating all the problems inside, the general part could have been used as a community center for the youth to play basketball. Maybe the school system should have torn it down instead of selling it. That is all hindsight now. The only thing I can think of now is to turn it into apartments, and that would come with a hefty seven-figure amount. It would be less expensive to tear it down and build new apartments instead.”
A flyer for a rally Tuesday said if the town ends up paying for demolishing the building, demolition would be paid for by property taxes and could be over $250,000. Clerk-treasurer Tonya Conley said the demolition would be paid from the Economic Development Income Tax fund, which has accumulated since 2012.
Jason McGlennen, town marshal, said he’s cited the school for violation of town ordinances more than 365 times. To his knowledge, the LLC hasn’t paid one violation.
McGlennen said one estimate to demolish put the price at $150,000.
After a short break in the proceedings, architect and real estate broker James Malcolm testified he’s walked the entire building twice and agreed there was mold, but once removed along with the moisture, “mold can be quickly remediated simply by God.”
Malcolm said the school is safer than many buildings he’s rehabbed in the past.
Baur testified how he’s tried to keep kids out of the building, but it’s been a game he couldn’t win. He talked about the “great architectural significance” of the building’s art deco style. It has emotional significance to people in the town, and is one of the last “Hoosiers”-style gyms in the state. He also said he didn’t feel the building was unsafe.
Baur said more than 50 people came to the rally Tuesday and they didn’t want to see the building come down.
“I want to do whatever I can to save the building,” he said.
When Reust asked Baur who the other LLC partners were, Baur said they didn’t want to be identified. Earhart insisted he answer the question.
Baur said it was his wife.
Baur said the LLC didn’t have a great deal of money to do any renovations. Munson said they could agree that it had less than $10,000.
“It seems to me, it’s the city’s responsibility to show it’s dangerous,” Baur said. “It’s not my responsibility.”
“Oh, really?” Reust countered. “So it’s the town of Silver Lake’s responsibility to make sure that owners of a building have a safe building? That’s your testimony here today?”
“The town of Silver Lake is the one that wants to demolish the building, not me,” Baur said.
Paul Hayden, director of the Northeast Field Office of Indiana Landmarks, testified that based on the school’s age, architectural style and architectural integrity, it is a historical building and under that definition it qualifies for the National Register.
He said his office would be interested in the building if it was the sole owner and the building would have to be donated to the Landmarks organization as it is not interested in buying it.
Before Landmarks would take it over the building, it would have an inspection done, but would only pay half of the $3,500 cost.
“This building’s been vacant for over 10 years that Mr. Baur has had it,” Hayden said. “... Buildings start to deteriorate very rapidly. It becomes a tipping point where a building is not financially feasible to be restored. We’re getting to that point.
“Our interest in the building is only good for the next six months. By January of next year, we’re out. If this building needs to be demolished, we will not formally oppose that. We think the building needs to be restored, but it needs to be done right away.”
SILVER LAKE – After nearly three hours of testimony on the order to demolish the former Silver Lake Elementary School, Hearing Officer Thomas Earhart had a simple question:
Who owns the building?
Silver Lake Partners LLC was set up early on, he said, but it was dissolved. “So there was a period of time when there was no LLC ownership at all, until the new LLC was formed in February. ... Because the property was originally part of the original LLC that was dissolved, I’ve heard no testimony about whether the property has been made an asset in the new LLC. Can anybody enlighten me on that?” Earhart said. “Because if not, it reverts back to Mr. (Mike) Baur, he’s the owner.”
Baur is a member of the Silver Lake Partners LLC and is fighting the town’s efforts to demolish the old school. His attorney, Bruce Munson, said, “I don’t think by reason of being a member of an LLC he becomes the owner.”
Earhart said he thought there was a statute where Baur became owner as an individual because of the dissolution of his LLC and because the property wasn’t reinstated in the new LLC. Munson said he thought there was a statutory protection against that.
Earhart told Munson if he could find that, to send that information to him. Munson said he would.
Scott Reust, town attorney, responded, “The only deed that’s been recorded – unless there was some deed or transfer of asset otherwise, which real property can only be transferred by deed – was recorded in 2008 and that was transferred to Silver Lake Partners LLC 2008 entity. I don’t know who else could possibly be the owner without a transfer of that property.”
Earhart said he wasn’t in a position Wednesday to make a decision on the demolition. “I will do that in what I believe is a fairly timely manner because I know this is something of a concern to not only to the parties but to the town of Silver Lake as well,” he said.
He said he will notify the legal counsel of his decision.
After Earhart makes a decision, there will be an opportunity to appeal it through Kosciusko County Circuit Court within 10 days.
Reust told Earhart that the LLC was created as a domestic limited liability company Oct. 15, 2008. The partners purchased the property from the Winona Arts & Restoration Preservation Inc., with the warranty deed recorded Oct. 29, 2008.
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“Since Silver Lake Partners LLC has been owner of the building, there’s been numerous, unending complaints of the dilapidated building, unsafe structure and the uninhabitable building. The town of Silver Lake has had to deal with that on a regular basis for now going on 10 years,” Reust said.
He said Baur is the registered agent of the partnership and whom the town deals with, along with his attorney, Munson.
He said the town has made every effort to “hold (the partnership) to the promises they made at the time they became owners of the building, and none of that has come to fruition.”
Baur later said he never made any promises but had goals for what he wanted to accomplish.
Reust said the LLC was administratively dissolved in 2014 so there was some confusion as to who may be appearing for the LLC.
Munson said the LLC was reinstated in February, but Reust said that wasn’t true. Munson said it is true according to Secretary of State records. Reust said a new company was created and new articles of organization were filed, but it wasn’t a reinstatement.
Munson said he and Baur were there on behalf of Silver Lake Partners LLC, and Reust asked, “Which one?”
Munson said both the 2008 and 2018 LLCs.
Town Council President Chad Miner testified there’s been a number of complaints over the years about the school, including ongoing deterioration, birds or bats in the building and the building’s proximity to the park where children are present.
Miner said he was not on the town council when the partnership purchased the building, but the original stated goal was for it to become a charter school. He said in the shape it is now, he didn’t think it could be used for that.
In fall/winter 2016, Reust said the town hired Calvin Bolt to inspect the building. Miner said complaints about the school have continued since.
“As the condition of the building continues to deteriorate, and it continues to become increasingly unsafe ... I think demolition would be the appropriate way of resolving (the matter),” Miner said.
Munson asked Miner if the town ever presented a list of corrections that it wants with a deadline to the Partners. Miner said he believed so, and the inspection report prepared by Bolt listed the various issues with the building. Miner said the town’s position now is that the issues need resolved “immediately.”
Munson said Bolt’s report did not recommend demolishing the building. Miner said Bolt did say the cost of repairing the building would be greater than its value.
Miner read a portion of Bolt’s report: “The building is sort of an albatross. Maybe before the roof started leaking, creating all the problems inside, the general part could have been used as a community center for the youth to play basketball. Maybe the school system should have torn it down instead of selling it. That is all hindsight now. The only thing I can think of now is to turn it into apartments, and that would come with a hefty seven-figure amount. It would be less expensive to tear it down and build new apartments instead.”
A flyer for a rally Tuesday said if the town ends up paying for demolishing the building, demolition would be paid for by property taxes and could be over $250,000. Clerk-treasurer Tonya Conley said the demolition would be paid from the Economic Development Income Tax fund, which has accumulated since 2012.
Jason McGlennen, town marshal, said he’s cited the school for violation of town ordinances more than 365 times. To his knowledge, the LLC hasn’t paid one violation.
McGlennen said one estimate to demolish put the price at $150,000.
After a short break in the proceedings, architect and real estate broker James Malcolm testified he’s walked the entire building twice and agreed there was mold, but once removed along with the moisture, “mold can be quickly remediated simply by God.”
Malcolm said the school is safer than many buildings he’s rehabbed in the past.
Baur testified how he’s tried to keep kids out of the building, but it’s been a game he couldn’t win. He talked about the “great architectural significance” of the building’s art deco style. It has emotional significance to people in the town, and is one of the last “Hoosiers”-style gyms in the state. He also said he didn’t feel the building was unsafe.
Baur said more than 50 people came to the rally Tuesday and they didn’t want to see the building come down.
“I want to do whatever I can to save the building,” he said.
When Reust asked Baur who the other LLC partners were, Baur said they didn’t want to be identified. Earhart insisted he answer the question.
Baur said it was his wife.
Baur said the LLC didn’t have a great deal of money to do any renovations. Munson said they could agree that it had less than $10,000.
“It seems to me, it’s the city’s responsibility to show it’s dangerous,” Baur said. “It’s not my responsibility.”
“Oh, really?” Reust countered. “So it’s the town of Silver Lake’s responsibility to make sure that owners of a building have a safe building? That’s your testimony here today?”
“The town of Silver Lake is the one that wants to demolish the building, not me,” Baur said.
Paul Hayden, director of the Northeast Field Office of Indiana Landmarks, testified that based on the school’s age, architectural style and architectural integrity, it is a historical building and under that definition it qualifies for the National Register.
He said his office would be interested in the building if it was the sole owner and the building would have to be donated to the Landmarks organization as it is not interested in buying it.
Before Landmarks would take it over the building, it would have an inspection done, but would only pay half of the $3,500 cost.
“This building’s been vacant for over 10 years that Mr. Baur has had it,” Hayden said. “... Buildings start to deteriorate very rapidly. It becomes a tipping point where a building is not financially feasible to be restored. We’re getting to that point.
“Our interest in the building is only good for the next six months. By January of next year, we’re out. If this building needs to be demolished, we will not formally oppose that. We think the building needs to be restored, but it needs to be done right away.”