Facing a funding crunch for its proposed move to midtown Sacramento, the B Street Theatre has asked the city of Sacramento for another $500,000 to make the move a reality.
City staffers say the city should hold firm with the $2.5 million already pledged to the relocation project, saying they don’t have surplus dollars available to grant B Street’s new request.
But Councilman Steve Hansen, who represents the central city, said he will ask fellow council members to approve the additional request at Tuesday’s council meeting. That’s when the council is scheduled to vote on finalizing the original $2.5 million in funding.
B Street officials said Friday that the additional $500,000 is crucial to getting construction started early next year on its planned complex near Sutter Medical Center in midtown.
“We cannot start until that ($500,000) is reckoned with, one way or another,” said Bill Blake, the theater company’s managing director.
Blake did reveal some encouraging news about the B Street project: The theater recently obtained a $3 million “naming rights” commitment on the new building to bring the project closer to fruition. With that commitment, he said B Street has raised more than $8 million from patrons and other donors.
He declined to identify the donor, saying the disclosure will come in a few weeks.
In any event, because of rising construction costs and problems with an earlier loan commitment, the project is still short of funds.
“We need to solve this half-million dollar gap as soon as possible,” Blake said, adding that interest rates are likely to rise next year.
The theater company has been raising funds for years to move from its cramped quarters on B Street to a more spacious complex at Capitol Avenue and 28th Street.
It thought it had reached a breakthrough last year when the California Infrastructure and Economic Development Bank approved an $8.4 million loan. The loan was contingent on B Street securing about $5 million worth of federal tax credits, for a total package of more than $13 million.
However, the theater company has been unable to get the tax credits. Instead, it has secured an $11.5 million loan with Umpqua Bank, according to a city staff report.
At the same time, the project has had to cope with rising construction costs, which pushed the budget to around $30 million, Blake said.
B Street has found a way to trim the budget by about $1 million, to just under $29 million. That puts the project within $500,000 of penciling out.
The city staff says the council should stick with the $2.5 million forgivable loan it approved a year ago.
The money for that loan “is coming from the sale of city-owned property at Fair Oaks and Howe Avenue – a one-time source of fund,” said City Manager John Shirey in an email. “To add to that amount would require an allocation of funds from the general fund, which is already under pressure to fund regular city services. The remainder of the sale proceeds from Fair Oaks and Howe is going for grants to small arts organizations which also need assistance to carry their programs to city neighborhoods.”
But Hansen said he will try to persuade the council to approve the additional money sought by B Street.
“We have labored and labored to get this done,” the councilman said, referring to B Street’s relocation. “We have an ability to finally get this project done.”
He said the additional $500,000 could be in the form of a larger loan.
“This is a smart investment that will pay off for generations,” Hansen said.
“We wouldn’t be doing this if we weren’t optimistic that this community is going to rise to the occasion,” B Street’s Blake said.