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Officials look into leasing options; frontloaded payment cause of concern

New Orleans Military and Maritime Academy is negotiating two leasing agreements with officials in Federal City.

The school’s board discussed the potential arrangement, along with other matters, at its May meeting. NOMMA’s currently housed at Murray Henderson Elementary School on L.B. Landry Avenue. School leaders are in talks to eventually move to a new school at 425 O’Bannon St. in Federal City. In the interim, they’d like to move to 2000 Opelousas Ave.

Neither the eventual school site agreement, nor the temporary school site agreement, have been finalized, officials said.

School officials are in their third round of discussions with the Federal City project’s developer, HRI/ECC, LLC. For the O’Bannon site, NOMMA will likely enter into a 71-year lease with an upfront payment of $1 million.

HRI/ECC, along with the New Orleans Federal Alliance and the Algiers Development District, are primary forces in the Federal City project, a mixed-use redevelopment of the former Naval Support Activity New Orleans.

During the meeting, board members discussed the risks inherent in a frontloaded rent payment. The school’s legal counsel, Jake Capraro and school commandant Col. Bill Davis led the discussion.

“I’m assuming we’re going to have to pay that lease up front, and it is odd and unusual,” said member Eades Hogue. Other board members shared Hogue’s concern.

But proper protections in the contract will reduce the risk, Davis said.

“The only thing that is non-standard is the pre-payment of your lease,” Caparo said, as board members continued to ask questions.

Caparo named some provisions the board should include in the leasing agreement.

“One thing to build in is to make sure that everyone upstream will have a legally binding obligation to mind your space and not kick you out,” he said. The lease will likely include a subordination and a non-disturbance agreement, he said.

Kathy Lynn Honaker, executive director of the Algiers Development District, was present and spoke during public comment.

“We’re looking forward to working with all of you and supporting you in any way we can,” she said.

Davis said the school hopes to have a lease signed at the end of June in order to prepare the grounds in July and to be operational in August.

Also during the meeting, the board discussed finances and staffing, as well as summer activities and student applicant numbers.

Baptist Community Ministries, one of Louisiana’s largest private foundations, has awarded NOMMA a $400,000, three-year grant to develop an information technology program. The cash will help pay for consulting, systems and software, but it won’t cover the full cost, Davis estimates. He expects the total program cost to be $750,000.

When discussing budget news, Davis said the school will end the fiscal year deficit-free. Officials have also terminated NOMMA’s business manager, who previously handled finances. To save money, instead of hiring a chief financial officer to do the job, NOMMA will likely hire a CPA firm to cover bookkeeping and taxes.

Davis declined to comment on the reasoning for the business manager’s termination.

In other staff updates, Davis said the school hired a part-time band instructor and a biology teacher, but is still interviewing candidates for a foreign language teacher.

NOMMA’s also offering summer programs this year. These include summer school classes, and a week-long cyber robotics camp. The school plans to add sports programs next year and scrimmage junior varsity teams in the area.

Additionally, the school has 160 applicants for next year, Davis said.

The meeting was called to order just after 6 p.m. and adjourned at 7:40 p.m.  The board’s next two meeting dates are June 13 and July 18.

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