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Town’s Baffling Negotiating Position Threatens 50-year Old Preschool

The owner of the Mulberry Tree Preschool, which is the round building adjacent to the Moraga Commons where many residents park on weekends, recently sent an email to its families and alumni seeking support to remain in the building they’ve occupied for 50 years.

As with many businesses, the school was battered by the COVID pandemic shutdowns but nonetheless continued making lease payments on the property (the Town owns the land, the school owns the building and all improvements). The school’s long-term lease ended last December and it entered into a short-term, six-month agreement with the Town until it had better visibility into the post-COVID future and intended to enter into another long-term lease similar to the one it has had during the past five decades.

The school now finds itself staring down the barrel of a newly-proposed lease that’s such a significant departure in terms and spirit from its previous, longstanding agreements that it could cause the school to shut its doors entirely while handing over the turnkey building – free – to the Town.

The brief six-month extension and staff’s proposed three-year renewal place significant restrictions on the business: they require handing over the building for free (including all improvements, present and future) and entirely preclude the transfer or assignment of the lease to a potential buyer of the preschool.

Contrast these restrictive terms with those offered to Wedgewood Weddings over at the Hacienda, a 10-year lease with two 5-year options (entirely at Wedgewood’s discretion), refunds of capital improvements if leases aren’t renewed, and no material restrictions on a business sale or transfer.

In addition, there has been a fair amount of public objection to the relatively generous Wedgewood lease whereas there has been no objection to continuing the “old” Mulberry Tree lease (all public comment thus far has expressed concern over the restrictiveness of the new one).

Why is staff proposing a lease that is such a substantial departure from 50 years of prior agreements, and why is it so strikingly different from Wedgewood’s, who has no history or relationship with the Town?

We surmise that the staff is eyeballing Mulberry Tree as a potential turn-key daycare or activity center that it could obtain for nothing. While the Town, indeed, ought to be seeking the best possible use of its assets (including the Mulberry property), there has been no strategy, business case, public discussion or Council approval for any such expansion of Parks & Rec programs necessitating such a move. Nor has there been consideration or discussion about whether or why the Town should seek to compete with private enterprise or why the Hacienda and other Town facilities would not be adequate venues should it legitimately determine to do so (and forego the lease payments of a 50 year tenant).

Nevertheless, the Council is being asked by staff to endorse lease terms that effectively will shut down a 50-year-old Moraga business without notice and preclude the possibility of transitioning to the next generation of ownership. Beyond the lack of development and associated public discussion of whatever “strategy” may underlie this recommendation, the moral and ethical implications are concerning.

If the Town believes it requires a shorter-term lease to afford itself the flexibility to explore alternative uses for the property, surely it can do so without forcing the surrender of the building and the effective shutdown of the enterprise while precluding the owner (only its third in 50 years) from selling the business if she eventually chooses to do so.

If you feel strongly about this, we suggest you contact the Town Council with your thoughts. Click here for the link to email the entire Town Council (look for the “email the entire town council” link 2/3 of the way down the page).


A Nextdoor discussion is here

Town Council page with email link 2/3 down the page is here


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