Standing in front of Museum Plaza’s idle construction site near the Muhammad Ali Center, Gov. Steve Beshear announced the state’s plan to submit an application for a $100 million federal loan from the U.S. Department of Housing and Urban Development (HUD) to jump start the project.
“Tough economic times mean we must be more creative to find funding for important projects,” Beshear said in a press release. “Applying for this federal loan is a first step, and while we cannot predict whether it will be approved, my administration is excited about the potential opportunity to create thousands of jobs and get Kentucky’s economic engines moving again. Furthermore, the application is risk-free for the state since, if approved, the federal loan will be entirely repaid by the developers.”
The developers of the $465 million, 62-story skyscraper development project, who say it could create nearly 7,000 short-term and permanent jobs, unveiled Museum Plaza five years ago, but it has hit a number of bumps in the road.
In 2008, construction stopped after complaints that installing the skyscraper’s foundation created strong vibrations along Main Street and endangered the historic buildings. Then the economy tanked and developers postponed efforts to borrow more money due to higher-interest costs on bonds and other important loans.
The Kentucky Department for Local Government (DLG) will submit the application on behalf of Museum Plaza, and state leaders are hoping to tap other sources of funding including:
$48 million – Already invested by the development team;
$90 million – Projected bond proceeds (bonds repaid by the Tax Increment Financing);
$45 million – City of Louisville’s contribution;
$15 million – Bonds related to the museum/supported by philanthropic commitment of development team;
$26.5 million – U of L for the Fine Arts & Business School space; and
$140.5 million – Traditional construction loan.