Remove ImagesMuseum Sold
January 28, 2010
In 1993, Chairman of the Guilford County Board of Commissioners Skip Alston and NC Rep. Earl Jones put together an organization to buy the old Woolworth's building – the site of the 1960 sit-ins – and turn it into the International Civil Rights Center and Museum, which opens next week.
It has not been smooth sailing for the project, which has been through a lot of changes. One change that is interesting because it has received so little attention is that the museum was sold last August by the nonprofit Sit-In Movement Inc. to a limited liability corporation (LLC).
The museum is currently owned by Museum Landlord LLC – a for-profit company – not the non-profit corporation Sit-In Movement Inc., which holds the annual banquet and has been working on getting the museum open since 1993.
Museum Landlord LLC owns the building and land, and is itself owned by ICRMC LLC, a for-profit company. Alston is the only member of ICRCM LLC listed, but he said Jones is also a member of the LLC.
Alston said the other members of the LLC, who actually own the museum, are Greensboro attorney Doug Harris, retired vice president of community relations for WFMY-TV Shirley Frye, Smith Moore Leatherwood attorney Carol Bruce and President of the Weaver Foundation Skip Moore.
Over the years the Greensboro City Council has donated about $1 million to the museum project, but none of the six councilmembers contacted were aware that the museum had been sold by Sit-In Movement Inc. to a for-profit corporation.
Nor did they know that Alston and Jones are two of the owners of the building, not just chairman and vice chairman of the non-profit Sit-In Movement Inc., which was set up to develop and run the museum.
Alston said the museum sold tax credits in order to raise the $14 million needed to finish the museum and get it open, a project that has been in the works for 16 years. He said anyone who was surprised that the museum was owned by a for-profit corporation didn't understand how tax credits work and the only way the museum could raise money through tax credits was to be owned by a for-profit organization.
Alston said that four or five LLCs had to be formed in order to complete the transaction that would allow the museum to sell its tax credits, and he said that after seven years, when the tax credits were exhausted, the museum would be sold back to Sit-In Movement Inc.
He said it had taken six or seven lawyers months of work, and cost hundreds of thousands of dollars in legal fees, to make sure the complicated deal passed muster legally. Alston said that although technically the LLC owned the museum and could sell it, a contract prevented the current owners from selling the museum. (Someone familiar with this type of deal said there is always a way to break contracts such as that, and suggested that something like the bankruptcy of one of the owners could create problems.)
Several councilmembers questioned whether the city's donation of $250,000 in this fiscal year was proper if the museum were a for-profit rather than a not-for-profit corporation. Last year the city's donation of $250,000, according to the city budget, was used for roof repairs.
Councilmembers questioned why they weren't told that the museum was being sold to a for-profit company, since they have been a major source of funding.
Alston said that, because they had been discussing using money from selling the tax credits to finish the museum for several years, he thought everyone knew that meant a for-profit corporation would have to own the museum.
Tax credits are one of those things that lots of people talk about but only a few people understand.