Months after state school officials canceled a deal to locate a rent-paying city high school in Port Discovery, the children's museum is scrambling to raise funds to keep operating.
"The decision to block the school from going to Port Discovery has seriously jeopardized our financial situation," said Douglas L. Becker, chairman of the board of Port Discovery. Becker said finding a replacement tenant will likely take months.
"We're trying to raise enough money to make it through fiscal year June 30, 2004, without having a tenant in place," he said. "If a couple people say yes to the things we're asking for, we're going to make it. We're raising money. We're asking people to be tenants."
The $32 million museum, which has been operating at a deficit, had sought the 20-year deal with the school system to stabilize its finances. It proposed shrinking to half its size and subleasing the freed-up space - about 40,000 square feet - in its Market Place building for $360,000 a year. But State School Superintendent Nancy S. Grasmick quashed the deal in April, saying the school system could not afford the estimated $8 million renovation and annual rent, utility and maintenance costs.
Port Discovery received approval last month from the Board of Estimates to seek a commercial tenant instead.
Becker, also chairman and chief executive of Baltimore-based Sylvan Learning Systems Inc., said he is optimistic that the museum will find the funding it needs, though he wouldn't say how much that is. Nevertheless, he said, the "very difficult situation" means it likely will be "years until we'll be able to move from a defensive posture into a proactive, forward-looking approach."
In the interim, the museum is continuing to pare costs. Operating expenses - about $5.8 million in fiscal 2002 - were trimmed to $4.4 million in fiscal 2003, which ended June 30, and are projected at $3.8 million in the current fiscal year, according to Bryn Parchman, the former chief operating officer who was named president and chief executive officer this month.
That should cut the operating deficit from more than $1 million a year to $400,000, she said. The museum had projected breaking even in fiscal 2004 based on the expected receipt of $360,000 in rental income, but instead will continue to run a deficit, Parchman said. "It's a tough environment, and it's tough to be a museum these days in general," Parchman said. "There are a lot of good things coming out of this place. We're resilient, and we're moving ahead."
The museum board chose Parchman to succeed Alan M. Leberknight, who stepped down nearly two years after he was hired to help turn around the struggling museum. Leberknight, a retired Towson University business school dean, is expected to continue many of his duties as a volunteer.
Becker said Parchman is well qualified, will provide a seamless transition and was happy to accept the job when many others might not have been willing to take it on.
Pratt concerned, too
City Comptroller Joan M. Pratt, the only member of the city's Board of Estimates who voted against Port Discovery's leasing deal with the school system, said she hopes the museum will find a way to survive.
"They're going to have to do something rather quickly or else they could be out of business," she said. "Hopefully, they can keep going. I think the concept is good, and it's something that is needed in downtown Baltimore."
As part of its cost-cutting, Port Discovery's offices will move from the nearby Candler Building to the museum building by Friday, saving $10,000 a month. The museum also will save at least part of the $90,000 salary paid Leberknight, who had cut his own pay twice. The position of chief operating officer, which Parchman previously held, is not being filled.
In addition, two employees were laid off last month after box office and group sales responsibilities were combined, shrinking full time staff to 35, Parchman said.
Additional obstacles
Aside from struggling with its operating deficit, the museum faces other hurdles. It has debts of $3.3 million, Parchman said, including $3 million due Baltimore City at the end of 2005 - a year's reprieve from the original terms. The city also allowed museum officials to use $3 million of capital to pay off higher interest bank loans.
Port Discovery has about $750,000 remaining in its endowment. It's also due $1.3 million on a loan it made to the Hi-Flyer Balloon, the tethered hot-air balloon ride located outside the museum, by 2006.
Attendance has never met projections. The number of visitors slumped to about 268,000 in 2001, 35 percent below its first full year of operation in 1999. That inched up 1 percent to 271,000 last year at a time when many high-profile harbor attractions lost attendance.
