MARLBORO — The Marlboro School of Music has offered to pay to maintain the campus of the former Marlboro College while a dispute over its ownership is resolved.
During a Wednesday afternoon hearing in Windham Superior Court, Civil Division, Judge Katherine Hayes heard from attorneys for the School of Music and the two parties that claim they own the property — Democracy Builders Fund and Type 1 Civilization Academy.
David Dunn, attorney for the Marlboro School of Music, said the school would be willing to fund the costs associated with maintaining the campus to insure this year’s Music Festival proceeds as it has in the past.
At the end of the festival, he said, there would be “a truing up” of what was spent. In return for “fronting the money,” said Dunn, the Marlboro School of Music is asking for a court stipulation that the campus not be encumbered with a mortgage or the property not be sold until the ownership issue is resolved.
The Marlboro School of Music, signed a 99-year lease in 2018 with the Board of Trustees of the former Marlboro College, which occupied the campus from 1946 until it merged with Emerson College last July.
The board sold the campus to Democracy Builders Fund, which proposed Degrees of Freedom, “a new kind of higher ed experience that is affordable, flexible, and inclusive,” according to its website.
The purchase of the campus and the founding of Degrees of Freedom was spearheaded by Seth Andrew, a former advisor in the Obama Administration. Shortly after Democracy Builders purchased the campus for a total of $1,725,000 in cash and debt, Andrew announced Degrees of Freedom would become a tenant to Type I Civilization Academy.
According to the notice of non-objection from the Vermont Attorney General’s Office, the deal was worth $9.4 million to Democracy Builders, which included $2.5 million in cash, $2.5 million in escrowed pre-paid rent, $2.5M as a mortgage-backed structured donation, and $1.5 million in Type 1’s assumption of certain lease obligations to the Marlboro Music Festival.
But then, Andrew announced the sale was off, claiming Type 1 had not met certain obligations listed in the sales agreement.
In documents filed by the Marlboro School of Music in Windham Superior Court, Christopher Serkin, the chairman of the board of the school, wrote that Andrew had informed him the cancelation of the agreement was due to Type 1’s failure to fulfill “certain maintenance obligations” related to the campus
To complicate matters, on April 26, Andrew was arrested in New York City, accused by federal prosecutors of stealing nearly $220,000 from Democracy Builders to help finance a mortgage on an apartment in the city.
Degrees of Freedom hoped to welcome students to the campus this fall, but has put its plans on hold until next year.
Adrian Stein, the principal behind Type 1 has insisted his organization holds the title to the property, assessed at approximately $4 million. Democracy Builders has asserted the same claim.
The Marlboro School of Music is obligated to pay $250,000 in rent for the use of the campus during the 10 weeks of the festival, while annual maintenance costs for the campus are more than $1 million.
“[T]here is the possibility that no alleged owner of the Campus will have sufficient funds or interest in properly maintaining the Campus to the extent required under the lease,” wrote Serkin in a motion to the court asking for permission to place its rent into a court escrow account until ownership is resolved. “Proper maintenance of the Campus is necessary to preserve the reputation of the Marlboro Music Festival.”
The agreement reached during the Wednesday hearing calls for the Marlboro School of Music to put its rent into an escrow account managed by its counsel and not a court escrow account.
When the Music Festival is complete, the parties agree to go over all the expenses related to the maintenance of the campus and paid by the School of Music to determine what should happen to the escrowed rent and what expenses might need to be reimbursed to the school by the rightful owner, whoever that might be.
“We have no objection to Marlboro School of Music’s counsel holding the funds in escrow,” said Kevin Lumpkin, attorney for Type 1.
Daniel Richards, attorney for Democracy Builders, said Dan Cotter, who has been the facilities manager on Potash Hill for many years, “is the right person to be doing the work and making a lot of the decisions about how this work is to be done and how the funds will be spent.”
Hayes asked the attorneys to present a written agreement to her by June 16, which would include information on what maintenance can be deferred, what needs to be done in advance of the Music Festival, which begins July 17, and how expenses will be approved and obtained.
“I would expect complete transparency about all of that,” said Hayes.
Hayes will also pen “a narrow order” preventing the encumberance or sale of the campus until ownership is resolved.
“My client has no intent to sell the property or parts of the property,” said Richardson, who said Democracy Builders had been in the preliminary phases of seeking funding to help maintain the campus, but the deal was never finalized. “Democracy Builders is caught in the middle here. They are in possession and control of the campus ... at the end of the day, we have to take seriously our obligations that are mandated under the lease.”