City demurs as board struggles to pay bills, transfer authority
At last week’s meeting of the board of Directors of Pack Place, Inc., board member and former mayor Charles Worley told the board that his “transition committee” has received input from representatives of Whitney Property Management of Asheville as to how – and for how much – Whitney would handle the day-to-day custodial requirements of the building and its three tenants, the Asheville Art Museum, Diana Wortham Theater and the Colburn Earth Sciences Museum.
In a phone interview with the Tribune, Worley later confirmed the meeting but stressed that his committee is still “in the information gathering stage” with regard to handing the building’s management over to a third party. The transition committee, composed of representatives of the Pack Place partners and the city, was formed to implement the transfer of actual control of Pack Place to the city.
But now, after months of wrangling, legal and otherwise, to acquire Pack Place, the city has indicated it cannot staff and maintain it, either from a budget or a manpower standpoint.
“The city does not look to manage Pack Place,” Vice Mayor Marc Hunt, who spearheaded the city’s takeover, told the board.
This led to the mention of the formation of a tenants’ association to take up the slack created by the gutting of the board’s authority. Such a group would be a small one, since there are only three Pack Place tenant-partners. And since the Colburn museum has already served notice that it will have to leave because it cannot afford to stay, that would leave a two-member association. (The Colburn’s lease is only for 12 months; the others are for 90 years.) So far, however, Colburn is the only tenant that has actually signed the direct leases with the city that were approved in August. The art museum, which for two years has fought tooth and nail for the direct-lease arrangement, has still not signed off on its lease. Neither has the theater.
Both the Pack Place corporation and the tenants have therefore been functioning in a sort of financial twilight zone since July 1, which was the original date established for transfer of control of the building from the board to the tenants. In late May the county agreed to give Pack Place Inc. about $7,800 in pro-rated funds toward the board’s lame-duck operations for July and August, (The county had originally agreed to pay Pack Place Inc. the full $409,000 it had budgeted for Pack Place utilities and maintenance, provided Pack Place did not change its business model. When the city insisted on going forward with the direct lease agreement, the county said further funding would now be contingent on presentations from the individual partners and any allocations from the county would go directly to them.)
The county funds have not yet been received. Pack Place Inc.’s operating budget for itself and its three tenants was running about $14,000 per month, and although the board has divested itself of most of its administrative authority, it still has a bank account and, until all accounts are formally transferred to the tenants’ names, Pack Place is still responsible for paying the bills. To slow the bleeding, Pack Place fired its six-person corporate administrative staff, including long-time managing director Heather Nelson, leaving three custodial workers in place to maintain the building.
Worley said his transition committee met three times in August and had concluded that Pack Place, as a corporation, was in no financial shape as a corporation to operate past August 31. Hay concurred, saying “We have just been muddling through from day to day.”
Board treasurer Michael Andry said the corporation has about $25,000 in the bank but also has outstanding bills in excess of that amount. “I don’t want to be treasurer in a situation where we don’t have any money in the bank,” he said.
Andry said it was time for the individual tenants to step in and pony up enough funds from their own accounts to help meet the corporation’s obligations which, after all, were mostly incurred on their behalf.
“The people we have let go are going to be applying for unemployment. What arrangements are we making for unemployment compensation?” board member Barbara Field asked.
“There’s compensated vacation time, too. It’s on our to-do list, to get to the bottom of it and pay it,” Hay said.
“It infuriates me that organizations that are receiving services from Pack Place are pushing back on contracts instead of helping. I’m about ready to say I’m done.” Andry said. The “pushing back” reference was apparently directed towards the Art Museum, which has indicated it is still not satisfied with its city lease.
Art Museum board chairman Lin Andrews said, “But haven’t we always operated a quarter in arrears? We get the bills, the county pays Pack Place, the bills get paid. Aren’t we still in that cycle?”
“We are in a cash crisis,” Andry replied. “We need money from the [tenant] organizations that are receiving services from us now.”
Board member Carol Peterson suggested approaching the Buncombe County Community Foundation. “Those are good people,” she said. “If they would agree to help us clear out all these debts and turn everything over to the partners, we could have done with all this and walk away with our heads held high.”
“Do you really think [Pack Place founder] Roger McGuire would want to see the money he put there for us used to destroy us?” Field asked.
“We couldn’t touch that money anyway,” said Worley. “It’s for capital improvements.”
Andry repeated that the tenants and / or the city should step in to neutralize Pack Place’s cash flow.
Art Museum executive director Pam Myers noted that neither Vicki Ballard of the Colburn nor John Ellis of Diana Wortham was in attendance, but said she thought the tenants would be willing to help but “there are some economies that could be made” to cut Pack Place’s projected indebtedness still further. She complained that the museum, for one, has not seen copies of any of the Pack Place invoices.
At that point Hay erupted.
“Take it all,” he said, speaking of the Pack Place funds and duties. “Take every bit of it. We’re tired and we don’t want to do it anymore. We’re trying to do you a favor, okay, but if you’re going to make it harder for us than easier, I’m telling you now, we” – he pointed to himself and Andry – “will walk.”
Assistant City Manager Paul Featherstone, attending his first Pack Place meeting, indicated the city might be willing, in the short term, to step in and in effect front the cost of essential services, but then charge that money back to the tenants once the transition is completed.
“Why are you talking directly to Mark instead of to the rest of us?” Fields asked Featherstone.
“I was looking around the table,” Featherstone said.
“Isn’t it amazing that you get what you wish for?” Peterson asked. Alluding to Pack Place’s 22-year run as a self-contained, multi-purpose entity, she asked, “Will anybody ever remember what happened here?”
County Commission chairman David Gantt told the Tribune later that the county will make good on the July and August funds it told Pack Place it would pay, but added, “Their ability to settle this will weigh heavily with the commission next year.”
Another Pack Place board meeting is set for October 8.