The future of the Columbian Theater is once again on hold as the school board determines what action it can legally take to return the property to former owner Ben Arnold.
The school board purchased the property four years ago with the intentions of renovating it and reopening it for local events for students and the community. As costs rose, plans were altered and the board decided to discontinue renovations. They soon learned that their original plan of returning the property to the former owner if they chose not to use it was not as simple as it sounded.
The board voted to receive the building on July 21, 2022 by voting to accept the property as a gift and agreeing to a first right of refusal agreement.
According to minutes from the regular board meeting, all board members voted in favor of the proposal. Members at the time were Troy Grider, who served as chairman, Dana King, Destiny Greer, David Karnes and Terry Harvey, with Pamela Stephens serving as superintendent.
A document signed on the same date deeds the property to the school district as a gift but gives Arnold a right of first refusal should the board decide to sell it or cease to use it for educational or theater purposes. Arnold would have 30 days following a written notice to exercise his right of refusal and purchase the property back for $1.
Dr. Pamela Stephens, who served as superintendent when the property was deeded to the school district, said the district was soon informed by the Kentucky Department of Education district facilities branch that the district could not return the property for $1 if any taxpayer funds were used to improve it. It could, however, be returned at fair market value.
A second document was then prepared by the school attorney, with an updated right of refusal dated Oct. 17, 2022. That second document was filed in the Adair County Clerk’s office on Nov. 14, 2022. Both documents were signed by Stephens; Arnold; Michael Owsley, the school district’s attorney; and Jaimie Wisdom, a notary public. The school board did not vote on the change, and Stephens said it was not required because the adjusted agreement was more stringent than the first.
After Jason Faulkner became superintendent on July 1, 2023, he soon realized that a number of expenses coming from the general fund were going toward repairs to the theater.
He learned that more than $200,000 had been spent on the facility, which already exceeded what the board approved to complete the renovations. He asked for an estimate to complete the project from the architects who were working on the new middle school. They estimated the cost would double.
Faulkner said the district was operating on a tight budget at the time, barely meeting the 2% contingency mandated by state law for the end of the fiscal year.
“So, my recommendation to the board was that we stop progress on (the theater),” Faulkner said. The board paid the remaining bills but discontinued the work.
Faulkner requested an appraisal of the property, which set the value at $50,000. He began discussions with Arnold to return the property. Arnold produced a copy of the right of refusal for $1 and stated that was the agreed terms.
“So, I consulted with our attorneys, I talked to the board, and the board was trying the path of least resistance, which was to give it back to Mr. Arnold,” Faulkner said.
Faulkner said KDE informed them that returning the property for $1 is against state policy.
“We also informed KDE that the other result on the other hand was that we were going to get litigated by Mr. Arnold,” Faulkner said.
Faulkner said all board members agree that the district should not spend more general fund dollars to renovate the theater.
“The most beneficial thing for us as a district to do – for us and even for the community because Ben is going to do something with it – then we should just give it back to him and let him,” Faulkner said. “The easiest thing is to honor the right of refusal the board agreed to and give it back to him for $1 and take the hand slap from KDE.”
Last week, a proposal to vote on giving the property back to Arnold was on the regular monthly school board meeting agenda.
As Thursday’s board meeting got underway, the board amended the agenda to drop the item to discuss the theater and instead to go into executive session to discuss proposed litigation.
Following the closed meeting, Faulkner informed the Community Voice, “Due to potential legal issues at this time, the board has decided to hold on transferring the deed of the theater to Mr. Arnold. We are going to consult with our board attorney, and we will come back and make a decision and get it to him as quickly as we are possibly able to.”
The Voice has learned that the board was notified prior to the meeting that Kentucky State Police opened an investigation on potential official misconduct. The accusation appears to stem from the board agenda including a proposed vote to give the property back to Arnold.
It now appears that the only route to a solution will occur in a courtroom. So, for now, the historic theater will remain idle, with its doors closed and its beloved “Columbian” sign remaining dark.
By Sharon Burton
snburton@adairvoice.com
