Project Analysis and Staff Recommendation

National Underground Railroad Freedom Center

Commission Assessment Team: Tony Capaci, chief analyst and Amy Rice, chief project manager

National Underground Railroad Freedom Center 50 E. Freedom Way

Cincinnati, Hamilton County
Facility and Project Sponsor Information

Executive
Summary: Under NURFC’s current operating structure, sustainability is an issue. NURFC is
working with the federal government to establish a federal museum and oversight
commission to commemorate the ending of chattel slavery in the United States.
A discussion draft of this legislation was completed in October 2009. Preliminary
terms include the “gifting” of the facility to the United States government and the
United States government, via an appointed board of trustees, operating the
facility in cooperation with the Secretary of the Interior and other federal
agencies. This legislation is not expected to be approved for at least 12 months.

According to NURFC officials, the plan would call for the existing bond debt to be
transferred to another yet-to-be established entity, unsecured, leaving the facility
debt-free (a condition of the federal transfer).

Facility Overview: The Center consists of a 160,000-square-foot facility located on the Cincinnati
riverfront. Features of the facility include a museum, interactive story theaters,
computer networking to other Underground Railroad sites, arts and education
facilities, and a public forum space.

The Center is owned and operated by the Sponsor, as an Ohio nonprofit

corporation since 1995.

Culture Presented: The preservation and presentation of features of historical interest or significance.

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 Sponsor
Background: The Sponsor states, “The mission of the National Underground Railroad
Freedom Center is to reveal stories about freedom's heroes, from the era of the
Underground Railroad to contemporary times, challenging and inspiring everyone
to take courageous steps for freedom today.”

Project Information

Scope: The Freedom Center is a $117.7 million project, opened in August 2004, and features
three pavilions celebrating courage, cooperation, and perseverance. The current
appropriation will reimburse the Sponsor for construction expenses previously incurred
but not yet reimbursed (the “Project”).

Regional Support

Matching Resources
The Sponsor demonstrated a minimum of non-state matching resources equal to at least 50 percent of
the total state funding of $15,500,000 (a minimum of $7,750,000). Matching resources were
substantiated in November 2008. On October 9, 2001, Substantial Regional Support was confirmed by
the Commission in resolution R-01-26. The following table is provided for informational purposes.

Source Amount
Cash-on-Hand $0
Funds Already Expended on Project $0
Irrevocable Written Pledges $0
In-Kind Contributions (up to 50%) $0
Operating Endowment $0
Private Contributions $34,000,000
County Government $0
City Government $4,500,000
Federal Government $12,000,000
Site Valuation $0
Other $0
Total Matching Resources $50,500,000
Minimum Match $7,750,000

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 Funding Model
Although on October 9, 2001, the Commission confirmed Substantial Regional Support in resolution
R-01-26, the Project is no longer Fully Funded. In order for the new state capital funds to be paid out,
the Sponsor must demonstrate that the Project is Fully Funded. Since the Sponsor did not meet bank
covenants in 2008, the bank required the Sponsor to sell $19M in investments to pay down the local
bond balance. The $7.75M unsubstantiated funds listed in the table below were the projected
investment income from these $19M in investments that were sold.

Source Amount Substantiation

State Funding $15,500,000
Cash-On-Hand $0
Private Contributions $63,000,000
County Government $0
City Government $6,000,000
Federal Government $22,200,000
Other (future investment $11,650,000 $7,750,000 not substantiated
income)
Total Funding Sources $106,700,000
Total Project Budget $117,744,000

Project Need

Provision of General Building Services

Although experienced in the provision of general building services at the Facility, the Sponsor has
marginal financial capacity to continue providing general building services at the Facility. In
anticipation of the Sponsor completing the proposed Facility transfer to the federal government,
Commission staff conditionally confirms the Sponsor continue to provide these services as permitted
by section 3383.07 of the ORC.

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 Approval of the Project and Authorization of the Expenditure of Funds

Appropriation History:
 
Appropriation Bill Appropriation G.A. Appropriation Comments
Name Number Date Amount
National Am. Sub. 6/24/2008 127 $850,000 Funding this project.
Underground H.B. 562
Railroad Freedom
Center
National Am. Sub. 12/28/2006 126 $2,000,000 Funded construction of the
Underground H.B. 699 freedom center.
Railroad Freedom
Center
NURFC H.B. 16 5/4/2005 126 $4,150,000 Funded construction of the
freedom center.
National H.B. 675 12/13/2002 124 $4,000,000 Funded construction of the
Underground freedom center.
Railroad Freedom
Center
National Am. Sub. 6/15/2000 123 $3,500,000 Funded construction of the
Underground H.B. 640 freedom center.
Railroad Freedom
Center
National Am. Sub. 3/18/1999 122 $500,000 Funded construction of the
Underground H.B. 850 freedom center.
Railroad Freedom
Center
Cincinnati Riverfront Am. H.B. 9/17/1996 121 $166,668 Architectural fees and
Development 748 continuing development
work on the freedom
center.
Cincinnati Riverfront Am. H.B. 9/17/1996 121 $333,332 Funded construction of the
Development 748 freedom center.
Total $15,500,000

Recommendation: The materials submitted by the Sponsor were reviewed and analyzed, and the
Commission project analyst, project managers, and executive director recommend approval of Resolution R-
10-17 and recommend the approval of the Project and authorization of the expenditure of funds.

Commission Actions This Meeting:

In Resolution R-11-XX, the Commission is asked to do the following: determine need for Project; determine
substantial regional support; determine the provision of general building services; approve the project and
authorize the expenditure of funds, pending certain requirements; and authorize the execution of legal
agreements.

Chief Analyst Project Manager

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 Executive Director

Exhibits

□ A Provision of Culture

□ B Detailed Project Budget

□ C Facility Project Info

□ D Project Team Resumes and qualifications

□ E Financial Statements

□ F Evidence of Local Match

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