Iowa City school district buys building from ACT for $8.7 million

IOWA CITY — The Iowa City school board unanimously agreed to purchase a building for $8.7 million that will serve as a space for professional development for educators, the online learning program and possibly career and technical education.

The district is buying the building — known as the Tyler Building, at 301 ACT Dr. in Iowa City — from ACT with Physical Plant and Equipment Levy funds. The annual property tax levy can be used to maintain school buildings, complete site improvements and purchase school equipment.

Board member J.P. Claussen was not present at the meeting Tuesday.

ACT is a nonprofit and national leader in college and career readiness that provides assessment tests to students.

“We see this as long-term serving our students,” Superintendent Matt Degner said. “It serves a lot of different needs to us. We can definitely use the space. If we have this, it opens up a lot of opportunities for what we can provide students.”

The Tyler Building was built in the 1980s. ACT recently invested $7 million in a new roof, heating, ventilation and air conditioning improvements, lighting upgrades and a new fire alarm system. The 85,000-finished-square-foot building is seated on 7.9 acres of land.

Duane Van Hemert, consultant on the school district’s facilities plan, said he expects the district to be able to get another 50 years of use from the building, even though an appraiser said the life expectancy of the building is 25 more years. Van Hemert estimated it would cost over $22 million to build and purchase land for a building of its size today.

ACT also is leaving behind an estimated $2 million worth of “first-class” furniture, Van Hemert said.

He estimates the cost of utilities for the building to be about $7,000 a month, similar to what the district pays for the administration office at 1725 N. Dodge St. in Iowa City.

Buying the building is part of the school district’s facilities master plan 2.0, which called for the purchase of a building to act as a multiuse facility by summer 2022.

“ACT has a long history of being a good community partner in Iowa City, and this arrangement is one more way for us to remain connected to our community,” said Janet Godwin, ACT CEO and former Iowa City school board member.

“After the pandemic, many of our team members opted to stay connected and work off-campus in remote or hybrid schedules, so we determined that we could consolidate and make better use of the space on our campus,” Godwin said in a news release. “Working with the school district on this property transfer is a win-win-win for ACT, the district and our community.”

The district will take occupancy of the building July 5, several weeks before the purchase agreement closes, to prepare the space for the 2022-23 school year.

The Tyler Building will be home to ICCSD Online, a virtual learning school the district launched during the 2021-22 school year, serving around 850 students. Educators have been using a building known as “Old Hoover” as office space and a place to meet with the online students in person if necessary.

“Old Hoover,” however, was demolished recently to create more parking and tennis courts at Iowa City High School, 1900 Morningside Dr.

Degner said there also is no space in the district for educators to meet in a large group without disturbing the school day. The Tyler Building offers a space for that.

School board members Jayne Finch and Maka Pilcher both voiced concern that the assessed value of the property is half the purchase price. Assessed values often are lower than market values.

“The market has never been so low for office space,” Finch said. “People aren’t buying office space.”

School board President Shawn Eyestone said many properties the district previously looked at cost more for less space than the Tyler Building.

“We’ve been looking at sites all over town to do this type of work, and it’s so exciting we landed on the Tyler Building,” school board member Lisa Williams said. “I think it’s easy to say it’s light years ahead of anything else we’ve been looking at.”

School board member Ruthina Malone said it does not feel like the district has invested as much into its K-12 online program as it should. She’s looking forward to seeing it have a “dedicated home” with this building purchase, she said.

“We’re a public education district that every time we build something, it tends to fill up pretty darn quickly,” Malone said. “You don’t get a building for that price for that size.”

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