Friday, December 03, 1999
UK Basketball Museum seeks financial assist
City, school asked to help with bonds
The Associated Press
LEXINGTON, Ky. Plagued by debt and disappointing attendance, a museum dedicated to University of Kentucky basketball plans to seek a financial assist.
The UK Basketball Museum has begun talks with the city and university in hopes they will help pay off $2.2 million in bonds that have become a financial drain.
The museum opened Feb. 11 to rave reviews for its interactive displays and exhibits featuring the team's long history of All-American players and seven national championships. But the museum has drawn fewer than a quarter of the 130,000 visitors expected in the first year, and members of its board of directors are trying to rekindle the early exuberance.
I think we can save it, said Scotty Baesler, a member of the board and a former UK basketball player. I'm optimistic.
Lexington Mayor Pam Miller confirmed through a spokeswoman Wednesday that discussions are under way about city help for the museum, located in the Lexington Civic Center adjoining Rupp Arena.
We are very active in the Civic Center, and we want the basketball museum to be successful, Ms. Miller said through her press secretary, Susan Straub.
Larry Ivy, UK's senior associate athletic director and a member of the board, said he does not know whether UK will help erase the debt. Discussions were preliminary, he said.
If we did help, I would assume it would be the Athletic Association that did it, Mr. Ivy said.
Few people have visited the museum since it opened, and donations to the nonprofit corporation that runs it have slowed to a trickle.
It's tough, said Mike Durham, the museum's executive director. It's just a lot of debt for a nonprofit to deal with.
In recent weeks, members of the museum board of directors have met with Ms. Miller and UK athletic director C.M. Newton to discuss what, if anything, the officials can do to help the museum make its payments on the bonds.
We're not saying we need this much money, Mr. Durham said. We're asking what can we do together to retire this debt sooner rather than later.
Mr. Durham said the museum must pay about $500,000 a year in two payments to reduce its debt.
It is unclear exactly how bad the museum's finances are at this point.
Enough for January
Admission to the museum is $5 per person except for children 5 and under, who get in free.
Mr. Durham said the museum has paid vendors on schedule and has enough money to pay about $250,000 on the loan in January. But early in the summer it had to lay off several workers, and Mr. Durham himself went part of the year without a paycheck in an attempt to make ends meet.
That was Mike's idea, said board chairman Jim LeMaster, a former UK player. I wish he didn't do it.
The museum's problems actually began even before it opened.
Its cost ballooned from $3 million to $5 million, and it opened late. Museum board members and UK were able to raise about $3 million of the start-up costs.
Donating the largest chunks of money for the project were the city of Lexington, which gave $1 million in cash, and John Schnatter, founder of Papa John's Pizza, who gave $500,000. The city also gave the museum 10,000 square feet of space in the Lexington Civic Center worth more than $100,000 per year at no cost.
The museum used a complicated financing scheme to raise $2.2 million in bonds through the nearby town of Midway, because it had already reached its capacity to issue bonds.
Oh, yipes, said Midway Mayor Becky Moore, when told of the museum's financial woes. It's my understanding that no one can come back on us for that financial obligation. We would have never done it if we were going to be responsible.
Lexington Councilman Bill Farmer said he knew the museum was having trouble but that no one had told council members it is seeking city help. Mr. Farmer said he wants to do what he can to keep the museum because he thinks it is an asset to downtown Lexington, but he needs to see financial statements first.
I'm not against anything. I just need to know more before I'm for it, he said.
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