By Cleary’s Notebook News

GLOUCESTER CITY, NJ (November 11, 2026) — For some time, a rumor about reopening the abandoned Mary Ethel Costello School has circulated throughout the community.

The Gloucester City Board of Education deeded the building, assessed at more than $1 million, to the Gloucester City taxpayers several years ago. The school was vacated in 2017- 2018 when students from the elementary school were relocated to the new $90 million Gloucester City Middle School a few blocks away.

That 122,000-square-foot building was constructed on land that once contained 70 homes, all acquired through eminent domain for approximately $35 million. The new school was designed to accommodate 685 students in grades 4 through 8.

After construction began, another $20 million was spent to remove underground oil tanks discovered on the property. An environmental organization attempted to stop the project, claiming the site was still contaminated.

THE IRISH TOWN DEVELOPMENT PLAN ANNOUNCED

Planning for the new middle school, located in the 400 and 500 blocks of Market Street between Fifth and Sixth Streets and bounded by Jersey Avenue, began in 2001. Construction on the new school did not begin until 2016.

During that 15-year period, CNBNews repeatedly asked school and city officials what would become of the Mary Ethel Costello School building and its 1.9-acre property. Those questions were never answered directly.

In 2018, Mayor Daniel Spencer announced that the city was in discussions with a developer regarding a redevelopment plan for the M.E. Costello property and surrounding neighborhoods. One section of the proposed development was to be known as “Irish Town.”

However, like many other ambitious, flamboyant redevelopment proposals over the years, the project never materialized. Similar plans, including Gloucester Vista, King Street Corridor, and Hollywood East, failed to move forward. A redevelopment proposal for nearby South Broadway during the 1990s suffered the same fate.

A NEW UPPER ELEMENTARY SCHOOL FOR ME PROPERTY

In the Spring 2026 edition of the Gloucester City School District magazine, a brief article discussed plans to renovate the Mary Ethel Costello School. The facility would house three grade levels by relocating third-grade students from Cold Springs School and fourth- and fifth-grade students from Gloucester City Middle School back to 520 Cumberland Street.

According to the article, the move is being considered because of increased enrollment in recent years.

The article stated:

“The timing of this project is still unknown. The New Jersey Schools Development Authority is working with the State to secure funding for all former Abbott districts. Pending State funding approval through the NJSDA, the district plans to construct a new upper elementary school on the site to help address overcrowding at Cold Springs School and Gloucester City Middle School. This brand-new school would be fully funded by the State.”

(Editor’s note: Taxpayer funding ultimately supports all state expenditures. The government has no money of its own.)

The NJSDA is a state agency responsible for funding, constructing, modernizing, and renovating public school facilities in 31 designated SDA districts, formerly known as Abbott districts. The agency also provides infrastructure grants to regular operating school districts throughout New Jersey.

SUPT. DR. SYKES’ $20 MILLION RENOVATION PLAN

In the 1980s, Superintendent Dr. Thomas W. Sykes proposed a plan to upgrade the Neighborhood Schools. Specifically, M.E. Costello School, Broadway School, Brown Street School, Gloucester Heights School, and Highland Park School.

The proposal called for making the schools accessible to students with disabilities, installing air conditioning, replacing windows, upgrading heating systems, and other improvements. Under the proposal, the state would fund half the cost, while local taxpayers would finance the remaining portion through a bond issue.

The Board of Education and the Mayor and Council ultimately rejected the proposal.

Several years later, CNBNews spoke with then-Superintendent Jim Hetherington, who said there would have been no need to construct the Cold Springs Elementary School had the Sykes renovation plan been approved.

DEVELOPMENT PLANS FOR THE HUGHES AVENUE APARTMENTS

This reporter also spoke with the owner of the Hughes Avenue Apartments, Mrs. Abramowitz of North Jersey.

The city exercised eminent domain over the property to make way for the Cold Springs Elementary School project. According to Abramowitz, the apartment complex had been sold to a prospective buyer who intended to renovate it into a community for residents age 55 and older.

Built in the early 1950s, the complex had approximately 330 apartments.

Under those plans, the rear portion of the property near Thompson Avenue would have been demolished to allow for site improvements and possible future single-family homes. The apartment buildings facing Market Street and extending to the Hughes Avenue circle would also have been demolished and replaced with single-family housing.

HOW DIFFERENT GLOUCESTER CITY MIGHT HAVE BEEN

A new multi-million-dollar gymnasium was installed at the M.E. Costello School shortly before it closed.

In addition, the Highland Park School underwent a $5 million renovation to accommodate approximately 75 students considered at risk of dropping out. Not long after those funds were spent, the school was closed, and the students were transferred back to Gloucester City High School.

According to a former Board of Education member, the district made that decision because it needed to show state officials that the high school was overcrowded and that it needed to build the $90 million Gloucester City Middle School. The 7th- and 8th-grade students who were housed in the wings of the high school were moved into the new Middle School. It is not clear whether those classrooms remain empty.

That board member, who requested anonymity, had previously provided reliable information to CNBNews regarding district matters.

The historic Highland Park Elementary Grammar School was demolished approximately nine years ago. The property has remained a vacant lot ever since.

SCHOOL DISTRICT COSTS INCREASE

Despite academic successes, district officials expressed growing concern over the financial outlook facing Gloucester City schools.

For the second consecutive year, the district’s annual increase in state aid was limited to six percent under New Jersey’s school funding formula. According to the report, Gloucester City has received more than $5 million less in state aid than administrators believe the School Funding Reform Act formula would otherwise provide.

At the same time, district expenses continue to rise, including salaries and benefits, transportation costs, tuition for out-of-district placements, technology expenditures, and facility maintenance.

Officials noted that Gloucester High School, which opened in 1960, and Cold Springs School, which opened in 1995, require ongoing investment to maintain safe and effective learning environments. The district also cited deteriorating athletic fields behind the high school as an area requiring long-term improvements.

Budget Gap Addressed

Superintendent Gorman reported that the district faced a significant budget deficit while developing its 2026-27 spending plan, the first such challenge in nearly a decade.

District administrators, the business office, and the Board of Education ultimately closed the budget gap without eliminating existing programs or staff positions.

The report also highlighted the challenges facing former Abbott districts such as Gloucester City, which have a more limited ability to generate local tax revenue than wealthier New Jersey communities.

According to district officials, a two-percent increase in Gloucester City’s school tax levy generates approximately $140,000 in additional revenue. In contrast, a similar tax increase in a wealthier district can generate close to $1 million.

AI can make mistakes contributed to this article