Tacoma’s city manager and LeMay auto museum officials this week resolved a lingering dispute over an agreement to build a long-awaited car museum on land next to the Tacoma Dome.
Both sides have agreed that museum officials can pledge city land donated for the project as collateral for future bank loans – so long as they get the city’s approval and spend the loans to improve the museum.
“I think it was a good resolution,” City Manager Eric Anderson said Wednesday. “It protects us in the way we intended to be protected, and it gives the museum the opportunity to improve on its success.”
“The museum would clearly see this as a concession to the city,” said Paul Miller, secretary of the museum’s board of directors. “But it’s a request we’re willing to agree to in order to move this project forward.”
Now that the clash has been settled, museum officials say they can move ahead to finalize financing for the project’s first phase: construction of a $20 million car center for the collection.
“We’d love to be breaking ground by April,” Miller said.
Before that can happen, museum officials must win approval of their new agreement from the City Council, which is scheduled to consider the issue at its Feb. 9 meeting.
More than 10 years in the making, the proposed museum would display the late Harold E. LeMay’s acclaimed car collection, which is now housed at the former Marymount Military Academy in Spanaway.
The latest agreement between the city and museum comes after months of negotiating several issues as part of an amended deal that culminated with a disputed version passed by the council in December.
The primary sticking point had centered on whether car museum officials could mortgage city land next to the Tacoma Dome to obtain future loans.
Car museum officials insist their agreement with the city always had provided for that.
But Anderson contended the issue had never been contemplated in previous agreements.
After LeMay officials recently talked about using the land for a loan, the city sought to clarify the issue to ensure city interests were protected, he said. City leaders expressed concerns that the valuable land – worth an estimated $14.5 million – might be lost should LeMay default on a loan.
In December, the council unanimously approved Anderson’s proposal that included language restricting LeMay from placing any encumbrances on the donated land without first obtaining the city’s consent.
The museum’s board later refused to sign off on those changes, saying they substantially altered the agreement and threatened financing for the project.
Both sides decided to negotiate the issue and began meeting earlier this month. A final agreement was struck on Monday.
Under the new deal, if the museum’s initial phase is successful and a seven-year, $3.5 million federal HUD loan for the project has been paid off, LeMay officials could then seek to mortgage the city-donated land to obtain a new loan for museum expansions or improvements.
The resolution will help to ease concerns among project financiers, both sides have said.
Once the council approves the agreement, LeMay officials will be ready to finalize the project’s financing, Miller said. Construction could begin 60 to 90 days after the deal closes, he said.
Lewis Kamb: 253-597-8542
lewis.kamb@thenewstribune.com
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