Northwest Arkansas Democrat-Gazette
Overhaul of Arts Center estimated at $98 million
Arkansas Arts Center leaders will need more than $60 million in private money to pay for the ambitious overhaul of the downtown Little Rock museum, according to a newly disclosed estimate placing the cost at $98.8 million.
Museum officials have kept secret the fundraising goal during a behind-the-scenes capital campaign, declining to answer questions about the target or their progress. The new figure was revealed in paperwork ahead of Monday’s scheduled sale of more than $30 million in hotel-tax revenue bonds that voters approved in February 2016.
Little Rock Mayor Mark Stodola, who said he did not know details about the fundraising efforts, called the sale a “healthy sign.” Issuing the bonds will open a three-year window in which the city must spend the vast majority of the proceeds in order to maintain tax-exempt status, with some exceptions, officials have said.
“Let me say, if those are the [actual] numbers, I am so very appreciative of our citizens who are contributing to what is going to be a magnificent building containing a magnificent art collection,” Stodola said by text message, adding it was “simply awesome” that private donors would more than double the city’s buy-in.
Merritt Dyke, president of the Arts Center’s board of directors, declined to answer specific questions about fundraising. The national firm Ascent, the project manager, developed the preliminary cost estimate, he said.
“They are approximate, and they are estimates,” Dyke said, noting detailed design plans are still being developed. “You’re still working with a whole team of people to try to do a better job of estimating the costs. … I continue to be cautiously optimistic that we can raise the money that we need to make this project work.”
The board president has consistently said the construction budget is $70 million. That price does not account for so-called soft costs such as architectural and consultants’ fees — so a total cost estimate had not been publicly known.
Paperwork in advance of the bond sale estimates about $31.3 million in proceeds specifically for the Arts Center project. That number also is an estimate and will be finalized after Monday’s sale. Project costs above that amount will be paid by the nonprofit Arkansas Arts Center Foundation, according to the document.
City Hall owns the Arts Center building in MacArthur Park and pays $700,000 each year toward maintaining it. The city board appoints the museum’s board members.
The nonprofit Arkansas Arts Center Foundation owns the artwork and controls an endowment from which it issues grants to cover day-today operating costs.
Seeds for the expansion and renovation were planted in 2015 after it was reported the foundation considered taking the artwork to North Little Rock over complaints about the building.
Little Rock officials subsequently increased the annual maintenance payments, raised the city’s hotel tax by 2 percentage points and pledged the tax increase to pay down voter-approved bonds.
The Arts Center’s board in 2016 hired Chicago architectural firm Studio Gang to oversee project design. When the firm unveiled a high-concept design earlier this year, the estimated construction budget swelled from $46 million to $70 million as museum officials squared their wish list with what they thought was affordable.
Portions of the 81-year-old, repeatedly upgraded museum will be torn down. The original “Museum of Fine Arts” facade — currently buried inside the facility — will be uncovered and used as a new entrance facing East Ninth Street, according to the public plans.
A walkway that invites natural light will link the remade museum’s expanded art school, children’s theater and gallery space, including a new second-floor exhibition area. The path will connect the Ninth Street entrance with another that spills into MacArthur Park, where asphalt and parking spaces will be replaced with a garden and cypress trees.
For months, officials have conducted a fundraising campaign aimed at the wealthiest prospective donors. Harriet and Warren Stephens, chairman and chief executive of the Little Rock investment firm Stephens Inc., have led that effort. After this “silent phase” concludes, the campaign will go public, Dyke has said.
Warren Stephens, who also serves on the foundation’s board of directors, was traveling Wednesday and did not immediately return a message left at his office. His firm is underwriting the bond sale, meaning it will pay the city upfront for the bonds and then sell them to investors.
Architects are finishing a detailed design. Construction is scheduled to begin a year from now. If the current timeline holds, the rebuilt museum would reopen in early 2022.
The city board approved an ordinance in March that authorized the bond sale, which is scheduled for Monday. Afterward, the board will vote on amending that ordinance to include final details, such as the actual borrowed amount, the interest rate and annual debt service.
Bond proceeds will include $1 million for improvements to the neighboring MacArthur Museum of Arkansas Military History.