The city is poised to once again bail the troubled GulfQuest Maritime Museum of the Gulf of Mexico out of financial turmoil by taking over $2 million of a loan the facility’s nonprofit foundation has already defaulted on.
The foundation took out a $5 million loan with the help of nine banks to pay for exhibits and other expenses before the museum opened. The foundation has since defaulted on that loan, paying just $100,000 in principal on the debt to date, Mobile’s Executive Director of Finance Paul Wesch said Tuesday, July 16.
Through an agreement with the museum’s board, Wesch said the city will buy $2 million of the loan if the board can immediately raise $500,000 to help pay the original loan back. If that happens, Wesch said, the city would pay back the $2-million portion it will take on through annual $400,000 payments over five years.
“If we do that the banks will forgive the other $2.4 million,” Wesch said.
As a result of the restructuring, the operating agreement between the city and the museum’s board will be amended. The new operating agreement, Wesch said, would give the city full control over the day-to-day operations of the museum, while the board would handle fundraising and upkeep of the exhibits.
“It allows the two groups to do what each does best,” he said.
The city had previously taken control of the museum operations, but this would make the role permanent. The museum employees would also remain city employees. The agreement is similar to the city’s setup with the Mobile Museum of Art, Wesch said.
Per its rules, the Mobile City Council delayed a vote on the item being introduced for the first time. At the behest of a number of his colleagues, Councilman Joel Daves has convened a meeting of the body’s finance committee to discuss the deal. The meeting will take place Monday, July 22 at 9 a.m.
Wesch said the council must make a decision by July 31 to avoid further problems with the loan.
In other business, councilors voted down an appeal by Jim Walker of the Mobile Tree Commission’s decision to allow for a 100-year-old oak tree to be cut down at the corner of Church and Warren streets. The tree in question is in the right-of-way and is therefore subject to a Tree Commission vote.
Walker said the tree was not an imminent danger to the community and therefore should be saved. Urban Forester Peter Toler said that while the tree was not a threat to fall, a large portion of it consisted of dead wood and would have to be trimmed in such a way that it would no longer be aesthetically pleasing. He also said it would need to be removed to ensure the safety of the seven other trees on the property, as the owner is looking to build a driveway.
Two other arborists joined Toler in his assessment of the tree during the meeting Tuesday.
Council Vice President Levon Manzie has appointed a committee to look at issues within municipal court. Councilman Fred Richardson will chair the committee, while Councilman Joel Daves and Councilwoman Gina Gregory will serve on it.
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