The city Finance Committee on Monday approved the issuance of up to $30 million in bonds to purchase the College of Santa Fe campus, as well as a lease agreement with the group planning to run a private arts school there.

All five members of the committee voted in favor of both issues, although they directed staff to gather more information before the full City Council votes next week.

The group also did not vote on a separate proposed ordinance that would have the city borrowing up to $30 million from the New Mexico Finance Authority rather than issuing bonds itself, because terms of the loan were not available.

The approvals came with much discussion, as Monday's meeting was the first public airing of the lease agreement with Laureate Education Inc., a for-profit organization that runs colleges around the world.

The terms of the lease have Laureate paying $2.35 million per year for 61 acres of land and 499,000 square feet of buildings. That amount would be enough to cover the city's debt payments, according to city staff.

The agreement would last 26 years, with an option for Laureate to terminate with 225 days' notice.

But while most of the lease details have been finalized, there are still a few points of contention between the two parties.

One of the most discussed on Monday was the terms of an option for Laureate to purchase land and buildings from the city.

Councilors want to ensure that if the city does sell property or buildings to Laureate, it gets not only its investment back, but also is compensated for any increase in value. The issue is how to do that while also taking into account improvements Laureate might make.

"It's not a risk (for the city)," Councilor Rebecca Wurzburger said, "but it's a fiduciary responsibility."

Another sticking point is how to deal with electrical infrastructure, which both parties agree will need to be updated. Plans have the city setting aside $1.6 million in reserve for electrical improvements.

What has not been decided is whether the city will incur costs above the $1.6 million or whether it would share responsibility for expenses with Laureate.

Kathy McCormick, director of the city's Housing and Community Development Division, said it would be staff's recommendation that after the city spent the $1.6 million, Laureate would be responsible for additional costs. Laureate has offered to split costs above $1.6 million in half, she said.

Another issue is what to do with the hundreds of pieces of art on the campus. The city is conducting an inventory of the art, McCormick said, but that exercise will take some time.

The committee agreed to remove any discussion of the art from the lease and save making a decision for another time.

Councilors had questions too about the property and buildings that are not included in the lease. If approved, the city will also purchase a number of World War II-era barracks, some of which are occupied and used by the Christian Brothers, who founded the college.

Councilor Matthew Ortiz had questions about the intentions for the those buildings, including the amount of deferred maintenance, and whether the brothers would be allowed to remain.

McCormick said she didn't know what would happen to the brothers. "I'm quite embarrassed," she said, "but I have not had that conversation."

The full council is scheduled to vote on the proposed ordinances July 29.

Meanwhile, representatives from Laureate and the city will host an open house today to provide more information about plans for the campus. The event is scheduled to take place from 4-7 p.m. at the Greer Garson Theater.

Contact John Sena at 986-3079 or jsena@sfnewmexican.com.