Since our publication of the Preliminary Carpe Terram Results, another $153k of commitments has come in, bringing our total to $1.42M from 150 Veritas families, friends and supporters. Though that total fell well short of our $3.55M goal, we are grateful for the outpouring of support in such a short window of time. Praise God!… and thank you for your willingness to step up and commit to giving to this school in order to provide it with a permanent home.
Consistent with the plans we previously laid out, on Monday of this week we did terminate our contract for the purchase of this property, protecting from forfeiture the $50k we had deposited in escrow. After that termination was communicated to the seller, the creative juices began flowing in the minds of so many people who have been a part of this deal. And one landowner from whom Standard Pacific (our seller) had previously purchased land and impervious cover came up with an idea that we think has great merit and may be palatable to the seller while allowing the school to acquire the property in spite of our limited fundraising success. In fact, the terms of this possible deal revision could be much more favorable to Veritas, saving us over $1.3M up front and providing us with greater flexibility down the road.
Possible Deal Revision
Instead of acquiring the whole 96 acres with 6.5 acres of Impervious Cover (“IC”) for $3.55M as originally intended, the new idea is to bifurcate (or divide) the transaction so that the school can immediately acquire what we estimate to be our minimum plausible campus size of 4.5 acres of IC within a gross site area of around 40-50 acres for $2M (plus $200k of closing costs being passed through to us). A two year non-recourse note in the amount of $1.3M (accruing interest at 6% per year) would be issued for the remaining portion of the tract consisting of 50-60 acres, including 2 additional acres of IC.
In this case, the non-recourse note is a form of seller financing and similar to an option in that the school could decide in the future whether or not it needed and/or could afford the additional land. If we conclude that we don’t want it or can’t afford it, the school would simply not pay off the note and return the land (the additional 50-60 acres with 2 acres of IC) back to the seller without penalty. The net effect is that the school could still end up with the whole 6.5 acres of IC on the original 96 acre site for $3.5M, but have to pay only $2.2M up front and the remainder in two years, unless we choose not to pay off the $1.3M non-recourse note and, instead, live on the 40-50 acres that we purchase up front. We would have full use of the entire 96 acres from day one, but wouldn’t be allowed to improve the “additional” piece (the 50-60 acre portion) until we pay off the note on it. Please know that the terms outlined above are very preliminary and subject to change.
We are excited by the prospect of this unexpected development that may afford the school the opportunity to purchase this property without overextending ourselves up front. In fact, this deal is even less expensive than the one we pursued in the spring of 2011 when we were trying to acquire Tract 14A with its 4.5 acres of IC within its 36 acre footprint at the corner of Mopac and SH45 for an expected price of about $2.3M. And that property (Tract 14A) doesn’t begin to compare with this one in every other way, e.g., beauty, spaciousness, privacy, security, tranquility, opportunity, etc.
So, where do we go from here? Well, first things first…
Return of Contributions & Commitments
We promised that if we didn’t raise commitments for the whole $3.55M, then we would terminate the contract and return everyone’s contributions and commitments. As I said earlier, we did terminate the contract, and now we stand ready to prepare the envelopes for returning to their contributors. Those commitment cards and checks remain nestled within their inner and outer envelopes in our safe deposit box at the bank. Beginning next week (after Memorial Day), we will have our accounting department start opening the outer envelopes in order to return any of them back to their contributors, if that’s what any donor wants. Just contact our Controller at Allison.Million@VeritasAcademy.net to let her know that you wish to come pick up your envelope or that you want us drop it in the mail to you.
“But Wait… I Want Us to Keep Going for the Land Since We’re So Close!”
If you would like for the school to maintain your contribution/commitment to see how the above described deal materializes, then do nothing. We will continue to maintain your contributions in the safe deposit box and keep everyone posted on developments.
Given that we presently have more than $1.4M of commitments, plus perhaps another $100-200k of expected accumulated surplus by the end of our fiscal year (June 30), we already have covered $1.5-1.6M of the $2.2M purchase price, or about 70%! So, what do you think? Should we go for it? Can we get there? The board is unanimously saying, “Yes! We can do this.”
In spite of the current unpleasantries with the board petition, we know — as do those supporting the petition — that our real struggle is not with each other, but rather the spiritual forces that work to divide us, temporarily prevailing upon the board, the petitioners, or more likely the both of us. Realizing that, we intend to work in good faith toward a constructive resolution. And, we further resolve to continue the necessary work of the school without obsessing over, much less becoming paralyzed by, the refining conflict at work within our body. It’s an unavoidable part of life, but as scripture says, it works to our benefit by producing great character in us.
Please add your voice to ours in praising God for this dramatic development that is emerging in our favor. We are incredibly blessed to have such competent, creative professionals inspired to help our school overcome its limitations. Please pray, praise, and genuinely consider upping your commitment — or contributing for the first time — in order to help us quickly close the funding gap and acquire this one-of-a-kind property while it is within our reach! If you have any desire to see Veritas acquire its own campus, now is the time to step up and help make it happen. Collectively, we can bridge the relatively small gap remaining. Additional Carpe Terram envelopes are available in the school office, or call/email Jef or Stuart to discuss how you may be able to help.
We are negotiating with the seller to get an additional 30 days to close this deal, but that might end up costing us some real money; so, instead, let’s gather the commitments we need now and be ready to act once the deal terms are finalized. Please share this update with others, especially friends and family members with whom you previously shared theFact Book
(click to see it) or other information related to our Carpe Terram campaign.
Come on, Defenders, let’s get excited about this! God is moving on our behalf. Let’s shout, “Thank you, Lord!” and go seize the land!
Carpe Terram pro Veritas!
Soli Deo Gloria
P.S. In exploring prospective co-development opportunities for the property we are pursuing, we recently began conversations with the elder board of a local church based in southwest Austin. This dialog appears very promising at this point, not that the church would be able to help Veritas acquire the property in the next few weeks/months, but it may prove able to buy in the near future some of our — or adjacent — property and share in the development costs.