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The Liberty Theatre project received a second $75,000 loan Monday from the Urban Renewal Agency. (Chris Baxter/The Observer)
The City of La Grande’s Urban Renewal Agency voted unanimously to disburse a second $75,000 loan for the Liberty Theatre project Monday night.
A special session was called by the agency due to a realization by the Liberty Theatre Foundation that a promissory note is due to BEARCO, the previous owner of the building, Aug. 31.
The August 2011 funding agreement between the Urban Renewal agency and the Liberty Theatre Foundation gave the agency first position lien on the property, 1010 Adams Ave., as security for the first loan disbursement of $75,000. BEARCO holds a Second Trust Deed and promissory note for $75,000 plus interest that is due Aug. 31.
The funding agreement provides for a second $75,000 from the Urban Renewal Agency to be used to pay the principal amount of the promissory note to BEARCO. The Liberty Theatre Foundation is responsible for accrued interest.
Also outlined in the agreement is a stipulation requiring the Liberty Theatre Foundation to comply with several conditions of the agreement before it can receive the second $75,000 loan.
Urban Renewal District Manager Robert Strope told agency members there were a few conditions not met by the Liberty Theatre Foundation. First, the Foundation did not provide cost estimates for the theater’s renovation that have been verified by an engineer or architect. Instead, the Foundation has been operating on an estimate provided by W.C. Construction and asked the agency to accept that estimate. Agency members Monday night agreed that estimate would suffice.
The Foundation was also supposed to identify specific sources of funding totaling at least 120 percent of the cost of the renovation with deadlines, match requirements and other information. Liberty Theatre board members requested that the agency allow them to provide reports with that information on a quarterly basis, which the agency members agreed to.
“The fundraising plan is a slow evolutionary process,” said Dale Mammen, chair of the Liberty Theatre Foundation Board. “It’s a living process.”
The Urban Renewal Agency-Liberty Theatre Foundation agreement also stipulates that the second $75,000 loan be secured by personal guarantees. The foundation offered in lieu of personal guarantees to execute a corporate lien certificate and to amend insurance requirements to a full replacement value policy with the agency as an additional named insured, if possible.
Agency members agreed that they did not think the personal guarantees were necessary.
“I think the personal guarantee is already there,” said Mayor Dan Pokorney.
Mammen told agency members now that the Foundation has been successful in obtaining smaller grants they can move on to larger ones.
“These people talk to each other,” he said of the various groups that grant awards. “We’re ready to pick the fruit on the big grants.”
Bob Larison, who helps with the Foundation’s finance and development team, said during the grant process, the first thing people look for is how much the Foundation is personally invested. Then they look to see if the local government is behind the project.
“With city support it will be a lot easier,” he told the agency.
The Urban Renewal District’s $150,000 investment in the Liberty Theatre is disbursed as loans, but they will be converted to grants upon the project’s completion, as long as it is completed within the guidelines of the agreement.
Agency member John Lackey was not in attendance at Monday’s meeting.