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Tacoma clears way for LeMay museum financing

Apr 29, 2009

Tacoma clears way for LeMay museum financing

Jason Hagey
Tacoma council members provided a big octane boost Tuesday for the long-planned LeMay Automobile Museum.

Council members approved a resolution clearing the way for the museum to apply for a $3.5 million loan from the federal Department of Housing and Urban Development’s Section 108 program.

Museum officials said they would use the money to leverage other financing that will allow them to break ground this year on a museum near the Tacoma Dome.

David Madeira, museum president and chief executive, said the loan – combined with funding from the New Market Tax Credit Program – would give the museum 100 percent of its goal and allow it to move ahead with construction of the $28.4 million first phase.

It could take a couple of months to get the final approval on the tax credits, but Madeira said the project qualifies for the program and there is no reason to believe it won’t take place.

“It’s a great night,” Madeira told The News Tribune. “We appreciate the city’s partnership and help getting this done.”

Council members, stung by criticism from taxpayers, emphasized that the federal government is the source of the loan funds – not the city’s general fund.

“It is not in fact a loan from the city,” said Councilman Mike Lonergan after reading from a letter from a constituent. “We are not giving anything away.”

Lonergan said council members believe there is an economic development benefit from the museum, and they are “not putting any of the city’s own limited resources” into the loan.

Councilwoman Marilyn Strickland said the museum will serve as “our own economic stimulus package.” It will provide construction jobs to women and minority-owned companies, and give Tacoma a tourist attraction, Strickland said.

Tacoma has participated in the Section 108 program for about 20 years. Mayor Bill Baarsma noted that money from the program was used to save the Sheraton hotel, now known as the Hotel Murano.

The museum would have up to seven years to repay the loan, and the debt will be secured by the museum building and land, pledge from a capital fund-raising campaing, and cars from the museum collection.

Jason Hagey: 253-597-8542 jason.hagey@thenewstribune.com blogs.thenewstribune.com/politics


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