LOUISVILLE — The Kentucky Center for African American Heritage continues to face financial struggles despite $15 million in investments since a renovation in the late 1990s.
The complex in Louisville's Russell neighborhood has operated almost exclusively as a meeting venue — primarily with space rentals helping to meet expenses — since a substantial renovation in 2009.
Work on the center has proceeded in fits and starts and was halted at one point for two years amid a state audit that found federal money earmarked for the project was being mismanaged.
Center spokeswoman Sue McNally told The Courier-Journal that progress has not moved as quickly as hoped on turning the center into a focal point of Kentucky's African-American culture.
Businessman Raymond Burse, chairman of the foundation overseeing the center, said the board doesn't have the money to pay a $705,000 court-ordered judgment to The Mardrian Group, or TMG. That's money that the onetime main contractor on the renovation was never paid. He said it also is unable to pay a $1.8 million loan long owed to Fifth Third Bank.
Burse said he is trying to negotiate a way out of the debt. Fifth Third spokeswoman Gail Lyttle declined to comment.
Teresa Bridgewaters, TMG's president, said her company has been hurt because it wasn't paid and that the contractor isn't in a financial position to forgo payment. TMG officials said they haven't ruled out trying to collect from the city of Louisville, which owns the property and leases it to the foundation for $1 a year.
The center had about $500,000 in income last fiscal year. Some money came from two foundation fund-raisers. Also, there was the city's annual donation of $130,000 for security and property upkeep as well as gifts from AT&T, Yum Brands and other corporations.
About 40 percent of the income came from the rental of space; a one-time cost to rent the main hall is about $5,000, McNally said.
Officials said nearly all the income went for operations. Much of the work is done by dozens of volunteers, McNally said.
Another committee has been asked to develop a "long-term vision," Burse said. He said $6 million to $8 million more is probably needed to complete the center's interior work in the four buildings in the complex and to build the museum exhibits. One building is still targeted as a job-training center.
Burse said there is no timetable for opening the museum.
Chris Poynter, a spokesman for Louisville Mayor Greg Fischer, said the city intends to keep the annual $130,000 contribution to the center intact.
"We want the museum and heritage center there, but obviously, it will take a lot of work and fund raising. It is a good location and a beautiful setting," Poynter said.