New Music Hall lease gets speedy approval

Cincinnati taxpayers are contributing $16 million for Music Hall's renovation on a faster timeline than initially planned.

Instead of paying $10 million in four installments through 2019, the city will contribute $10 million to the Music Hall Revitalization Co. within the next 30 days, according to a new Music Hall lease agreement unveiled Monday. City Council approved issuing $10 million of bonds for Music Hall last week.

The remaining $6 million pledge will come from city capital grants. The money will be provided in three annual payments starting in the city's 2017 fiscal year, which begins Friday. Initially, that money was going to be paid in $200,000 increments over 25 years to help maintain Music Hall.

"The key is structuring and organizing finances up front as you execute the deal," City Manager Harry Black said. "It's cleaner, simpler and, in the long run, more advantageous to ensuring a successful project."

Monday was also the first time the public learned about the lease redo and that the project's budget increased by $2 million to $137 million.

City Council's budget and finance committee approved the new 72-year lease and funding agreement Monday. The full council could approve the new agreement as early as Wednesday, voiding the previous deal reached in 2013.

So what's the rush? Officials from the city and Music Hall Revitalization Co. are raising as much cash as possible to prepare for a July 20 closing for construction and tax credit financing. The nonprofit Music Hall Revitalization group is charged with leading the project at the city-owned Music Hall and has tapped the Cincinnati Center City Development Corp., also known as 3CDC, as development manager.

The city has already given $600,000 to the Music Hall Revitalization Co. for capital improvements and repairs completed since 2013.

Last week, Otto M. Budig, Jr., who heads the Music Hall Revitalization Co., said there was pressure to raise the final piece of private funding for the project, or $2.7 million, prior to the project's closing. That gap was $4 million, but $1.3 million of work was temporarily removed from the project.

So far, the project has raised $63 million in private donations, fundraising consultant Scott Provancher said.

The committee's action on Music Hall was one of more than 20 items the panel approved in Monday's two-hour meeting. Council is scheduled to break for summer on Wednesday and most of the items pertaining to real estate development were introduced Monday as an "emergency."

Council members brought up other outstanding issues that concern the city, notably the city-owned Town Center Garage and the connecting skywalk from the garage to Music Hall. It's not clear what the future holds for both structures and money has not been budgeted for the Music Hall project for fixes to the walkway or garage. Also in jeopardy is the Central Parkway entrance to Music Hall, which was reintroduced into plans allowing patrons to enter the venue from the elevated walkway.

“Even if it’s an eyesore, with chunks of concrete falling, it’s something that a lot of stakeholders feel strongly about," Councilman P.G. Sittenfeld said during the meeting.

Councilman Chris Seelbach said people shouldn't fixate on preserving the "non-historic bridge" and look at other options.

“There are other ways we can get people into Music Hall other than an outdated bridge,” Seelbach said. "I hope that we’re open to the possibility there could be better alternatives."

Adam Gelter, 3CDC's executive vice president, said the development group is investigating "creative parking solutions" and other ways to get people into Music Hall.

Besides private gifts, the Music Hall project budget includes a $5 million state capital grant and state and federal historic tax credits. The project was awarded a one-time $25 million historic tax credit by the Ohio Office of Historic Preservation. Other large gifts include a $10 million gift from the Lindner family and a $3 million gift from the Society for the Preservation of Music Hall, made possible by a bequest from the estate of arts patron Patricia Corbett.

The national historic landmark in Over-the-Rhine was built in 1878. The venue shut down in June for the biggest renovation it has had in more than 40 years. Messer Construction, the project's general contractor, is overseeing the start of heavy construction. Springer Auditorium has undergone complete demolition of its wooden flooring, down to the soil.

Music Hall is scheduled to reopen in fall 2017. Music Hall is home to the region’s largest performing arts groups: the Cincinnati Symphony and Pops Orchestras, Cincinnati Opera, Cincinnati May Festival and, when renovations are completed, Cincinnati Ballet.