PROVIDENCE, R.I. (WPRI) — The state-run Providence Public School Department has cancelled plans to build a brand new school in the former St. Joseph’s Hospital in South Providence, Target 12 has confirmed.

The new K-8 dual language school on Peace Street was scheduled to open in 2025 under previous school construction plans, but that idea has now been scrapped due to cost, a spokesperson for the R.I. Department of Education said Wednesday.

The decision is a sharp about-face by city and state leaders after they touted the donation of a portion of the property by Joseph Paolino, the former mayor and real estate developer who owns the decommissioned hospital.

“It is going to cost more money to tear it down and to make it into a school than we anticipated,” Education Commissioner Angélica Infante-Green said Wednesday during an interview on 12 News at 4. “It’s unfortunate, we were really excited about the building, but it is going to cost an enormous amount of money to do that.”

Top leaders including Infante-Green, Mayor Jorge Elorza and others made a high-profile announcement at the old hospital property in 2020, taking reporters through the hospital on a tour and discussing where classrooms could be built.

But earlier this year the plans changed to a full demolition of the building, after engineers assessed the property and determined renovating the eight-story hospital would cost about $91 million and be more expensive than tearing it down and building anew.

The plans changed again when RIDE on Tuesday night released a new building plan for the school district as part of its announcement about the closure of two elementary schools and a middle school. The plan no longer mentioned the Peace Street School.

“The Peace Street Project will not proceed under this plan,” spokesperson Victor Morente told Target 12 in response to questions. “The cost to demolish and then rebuild at this location is $76 million. By not pursuing this project, PPSD will save $18 million and invest these savings to instead create two new preK-8 facilities at Fogarty and Kizirian – rather than just one at Peace Street.”

It was not immediately clear how much money was spent assessing the building over the past two years and preparing for construction. The hospital was shuttered more than a decade ago.

Reached by phone, Paolino said city officials have not terminated their donation agreement with him, which was signed in 2020.

“I’ve heard some of that talk, but I haven’t received any letters of termination,” Paolino told Target 12. “They still have an agreement with me.”

The agreement called for Paolino to donate the East building, the chapel and a parking lot to the city of Providence for free. In exchange, the city agreed to drop a dispute with Paolino over taxes owed on the property that became the subject of a court complaint.

“The property has not yet officially been transferred to the city,” said Andrew Grande, Elorza’s press secretary. “Any potential future uses of the building will be made by future city leaders.”

Mayor-elect Brett Smiley is slated to take over for Elorza in the new year.

“I did it out of the goodness of my heart to help the school system in the city of Providence,” Paolino said. “If they don’t want it, maybe it’s not the right decision for me and my family in this economy.”

Paolino said he would likely put the hospital back on the market if the city terminates the deal.

“I’m happy to sell it to them if they want,” he added.

Paolino had previously proposed to house people experiencing homelessness in the hospital, and said it could fit more than 300 housing units. The proposal was opposed by people in the neighborhood and later scrapped.

Another building on the property, which was not part of the donation agreement with the city, was potentially slated to become a charter school. But Paolino said Wednesday that talks with a Boston-based charter haven’t gone anywhere.

Hospital group CharterCare still leases a portion of the property for an urgent care center.

Steph Machado (smachado@wpri.com) is a Target 12 investigative reporter covering Providence, politics and more for 12 News. Connect with her on Twitter and on Facebook.

Kim Kalunian contributed to this report.