Steamboat Springs The Steamboat Art Museum is poised to take over additional space in the city-owned Rehder Building as Vectra Bank leaves for new digs in the Howelsen Place development just down Lincoln Avenue.
The move will allow the museum to install a gift shop in Vectra's former location and also will free up some room in the museum's exhibition space. In a 6-1 vote last week, the Steamboat Springs City Council approved a $1-a-year rent next year for the museum, which has been paying $700 a month. Council also agreed to let Vectra Bank, which pays $3,571 a month in rent, out of its lease four months early.
That move will cost the city $14,285, but Vectra agreed to do exterior work on the Rehder Building - including the removal of an ATM on the side of the building and a ramp leading up to it - not to exceed the amount the city is losing in rental income.
Already heavily subsidized from the city's general fund, the Rehder Building's loss of rental income has raised concerns for some. The building's other tenant, Antares, could be gone by Sept. 30, 2009, if the restaurant and the city do not agree on terms to extend the lease through April 15, 2010.
The museum has plans for the Antares space, as well. Steamboat Art Museum Board of Directors President Shirley Stocks said the restaurant would be converted into space for exhibition, a library, storage and shipping and receiving.
"We could offer more than one exhibit at a time," Stocks said. "We're a little limited on space right now."
The city's hope is to gift the building to the Steamboat Art Museum and rid itself of the financial burden.
"Therefore the city would no longer have the liability of operations and maintenance with no revenue," interim City Manager Wendy DuBord said.
Stocks said the museum would be happy to assume responsibility for the building.
"We'd like to have our own building to be housed in," she said. "It opens up a whole world of fundraising."
There are legal hurdles, however, because the building was willed to the city under specific conditions. The late Helen Rehder bequeathed the century-old Rehder Building at Eighth Street and Lincoln Avenue to the city in 2004 on the condition that it "be designated and preserved as a historical monument, and that it be operated as a museum for the preservation and commemoration of the lifestyle of settlers in Routt County."
The newly formed Steamboat Art Museum approached the city in 2006 about occupying the building after the Tread of Pioneers Museum rejected the city's offer to move from its Oak Street facilities. DuBord said Rehder's estate, which still is open, would have to approve any transfer of ownership. And DuBord said the process could take months or even years.
Councilwoman Cari Hermacinski, who was the only council member to vote against the museum's new $1 lease, said one reason she voted against it was that she thinks the estate needs to convinced and will want to see proof of the museum's financial strength before allowing the city to hand over the building.
"The first reason I said 'no' is because I don't think it's showing responsibility of our taxpayer dollars," Hermacinski said. "The second reason is, if they're able to pay $700 a month, that shows financial wherewithal."
The museum justified its request by pointing out that the city has similar arrangements with other nonprofit organizations. The Steamboat Springs Arts Council, for example, pays only $1 a year for its space in the Depot Art Center.
Antares' lease with the city also was discussed at last week's City Council meeting. The restaurant, which initially had hoped to sign a 10-year lease with the city, is requesting an extension of its present lease through April 15, 2010. Council approved the extension of the lease on first reading but directed staff to try to negotiate a higher rent with Antares before the lease extension ordinance returns for its second and final reading.
Purchasing/Contracts and Risk Manager Anne Small said Antares pays $2,737.92 a month in rent for about 3,600 square feet of space. That comes to about $9.13 a square foot per year. Tracy Barnett, program manager for Mainstreet Steamboat Springs, said commercial rents downtown typically range from $20 to $40 a square foot, with an average of about $30 a square foot.
Antares owner Diane Zahradnik said she has been in the Rehder Building for 14 years under a lease originally negotiated with the Rehders. DuBord acknowledged the low rent but said the city can't legally change it until it expires.
"It just hasn't been updated in any major way in years," DuBord said. "We wouldn't even be discussing this if not for the fact that Antares asked us to extend the lease."
Rex Brice, owner of three Steamboat restaurants, including Mazzola's Majestic Italian Diner downtown, said Antares's cheap rent with the city does not bother him as a competitor.
"As a restaurant owner, a big part of whether or not you're going to succeed is negotiating a good lease. They've certainly done that," Brice said. "As another restaurateur, that doesn't bother me at all."
DuBord said she will be recommending $15 a square foot for Antares, but Zahradnik said she might not be open to a higher rent. If a deal isn't reached with the city, Zahradnik said she has no intention of reopening the restaurant in a different location.
"I think at a higher rent, we might not stay," said Zahradnik, who said the city has not made any improvements to the aging building. "It still leaks on the dinner tables. There are a lot of things down there that would have to be done to bring it to market price. The Rehder Building is a long way from that."