The nonprofit group Handy is not letting the Broward School District get easily out of a highly scrutinized office space lease, filing a multimillion-dollar lawsuit that alleges breach of contract and damage to Handy’s reputation.
In a complaint filed last week in Broward County Circuit Court, Handy alleges it is owed full payment for the $2.6 million five-year lease for space in its Wilton Manors headquarters. So far, the district has paid $232,333, the lawsuit states. The nonprofit also is seeking compensation for reputational damages and attorneys’ fees.
Handy, which stands for Helping Advance and Nurture the Development of Youth, has had a longstanding relationship with the school district, providing food to homeless students and providing life skills training to those from disadvantaged backgrounds.
But the relationship soured in recent weeks after the School Board decided on Nov. 4 to terminate the lease it had approved on June 17. The district had intended to move employees from its facilities department into space at Handy’s recently purchased headquarters in Wilton Manors.
The lease led to a public backlash after the South Florida Sun Sentinel published a news article on Oct. 24, calling attention to the district’s plan to pay more than $500,000 a year for office space despite facing severe budget cuts and having plenty of room in low-enrolled schools.
The district also has been trying to find new uses for its extra space to stave off “Schools of Hope,” which are special charter schools that are allowed to operate on district-run campuses.
The facilities staff had not actually moved into the building, due to delays in equipping the facility to the meet the district’s needs, and the School Board decided to try to get out of the lease, holding a special meeting Nov. 4.
Board member Rebecca Thompson said at the November meeting that community members had voiced concerns about the contract.
“They’re saying, ‘you don’t have money to keep my school open but you have money to fund district staff,’” Thompson said. “That’s the sentiment that is echoed throughout all of these conversations. And even though I explain that we are looking at cuts, there will probably be layoffs, there will probably be other contract changes, that’s not what people are hearing in the news.”
Board members voiced concern in November about errors in an executive summary on the June 17 School Board agenda.
The summary said that the district could terminate the lease for convenience with either 90 days’ or 180 days’ notice. Both numbers were listed, but both were wrong. Other than for damage, the only way the district could cancel the five-year lease is if the School Board failed to allocate the expense in its annual budget, district lawyer Tom Cooney told an administrator in an Oct. 27 email.
“Defendants, in particular various school board members, cited terms that Handy ‘exploited’ the School Board and the School Board relied on a wrong executive summary prepared by its own School Board Employees which somehow gave rise to the School Board terminating a mutually agreed to Lease Agreement,” the lawsuit states.
At the November meeting, the School Board voted to deallocate the funds it had approved at the June meeting.
The cost of the first year’s lease was $510,000, plus an $85,000 security deposit.
“The School Board directed the Superintendent to … retroactively remove the previously allocated totality of funds sought to be paid for the Lease,” the lawsuit states. “However, the totality of the funds that were allocated previously was the entirety of the rent amounts owed under the Lease.”
District spokesman John Sullivan wouldn’t answer questions about the lawsuit. “We don’t comment on pending litigation,” he told the Sun Sentinel.
Handy’s lawyer, Thomas Sternberg, declined to comment when reached Tuesday by the Sun Sentinel. Handy CEO Kirk Brown could not be reached, despite repeated attempts by phone.
The School Board held a closed-door, attorney-client session Monday to discuss “settlement negotiations and/or strategy” related to the Handy lawsuit.