Moving into the Future
TURNING A DREAM INTO REALITY – Four and a half years ago the
R.R. Smith Center for History and Art opened its doors to the public
after undergoing an amazing $4.3 million restoration that brought this
late-19th century railroad hotel back from the brink of total decay.
Today this handsome building is one of the premier cultural arts centers
in downtown Staunton and the surrounding community. Exhibit galleries, a
research library, a lecture hall, classrooms, a state-of-the art
archival facility, a museum store,
A PARTNERSHIP – Three non-profit organizations - the
Augusta County Historical Society, Historic Staunton Foundation, and the
Staunton Augusta Art Center have partnered to make this project a
reality and now share the space in the building. From the very
beginning, the project has relied on partnerships – those of the three
organizations in the building as well as public partnerships with both
state and federal agencies, the city of Staunton and Augusta County, and
private and individual donors whose contributions amounted to $1.13
million. One final partner integral to the success of the project was
the Small Deal Fund, an investment group that assists organizations
involved in restoring historic properties. The Small Deal Fund leverages
SMALL DEAL FUND – Historic tax
credits can only be used by a for-profit entity; so for the five-year
term of the tax credit payback, the Smith Center LLC was established as
a for-profit entity. The LLC consists of representatives from each of
the three non-profit organizations in residence at the Smith Center.
While the Smith Center LLC manages the operations of the building as the
controlling partner, the Small Deal Fund, another for-profit entity,
actually has ownership of the building (99.99%). By law, on Dec. 31,
2010, the five-year historic tax credit period was completed. Once all
fees are paid to the Small Deal Fund by the final due date, it will exit
the partnership and return their 99.99 percent
SMITH CENTER OWNERSHIP – It is essential that the Smith
Center ownership be returned to the Smith Center LLC and the three
non-profit organizations. If this occurs in July of 2011 (six months
after the five-year tax credit obligation is complete) then the amount
needed to regain total ownership is $285,486.79. If that money is paid
back this summer, the LLC (representing the three organizations) has the
opportunity to reduce that amount by $20,000 or more by avoiding
accumulations of fees and interest.
OTHER OBLIGATIONS – In order to accept the tax credits to complete the rehabilitation project and open the doors to the public nearly five years ago, the Smith Center obtained a construction loan. That loan amount currently stands at approximately $705,000. In addition to paying for the ongoing building operations and maintenance, which amounts to approximately $105,000 annually, the Smith Center LLC and the three organizations have been able to lower that construction debt during the last year by $21,000.
COMMUNITY COMMITTMENT – The three non-profit partners at the Smith Center continue to make this facility a premier cultural center for the area. Eliminating the Small Deal Fund obligation and gaining 100 percent ownership in the building will fulfill our legal obligations with our business partner (Small Deal Fund) that brought this railroad hotel back to life. It will also allow us to continue to work toward the sustainability of this building as the cultural, historical preservation, and art center of the area.