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As sale process drags on, August Wilson Center debts climb

James Knox | Trib Total Media
The August Wilson Center on Tuesday, July 1, 2014.

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Some updates the August Wilson Center's receiver gave the judge:

• The receiver is awaiting suggestions from AMS, a consulting group that spent the past month meeting with community focus groups to determine whether a black cultural arts center can be viable.

• The center remains closed to walk-in public on a daily basis but hosted several events, including fundraisers, private parties and an open house to display the talents of local black artists. Additional events are scheduled through Aug. 2. On Friday, the Pittsburgh Cultural Trust will host a party at the center as part of the Cultural District's Gallery Crawl.

• The receiver plans to file a motion regarding the final sale to 980 Liberty Partners as a next step. If all goes smoothly, that deal could close by October.

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Tuesday, July 8, 2014, 1:54 p.m.

As pressure builds for a receiver to close a sale, the debts owed by the August Wilson Center for African American Culture soon will top $10 million, court records show.

Allegheny County Common Pleas Judge Lawrence O'Toole approved this week nearly $80,000 in payments for work completed in January by receiver Judith K. Fitzgerald, her legal counsel and her consulting firm. That's on top of $167,226 in payments to those groups for work through the end of 2013.

With time and money running out, Fitzgerald is trying to drum up support from civic leaders and social organizations to complete a proposed purchase of the Downtown building and its air rights for $9.5 million to New York developer 980 Liberty Partners, Fitzgerald said in her fifth interim report to the court.

“Both the buyer and I work toward achieving this goal,” Fitzgerald wrote in a document entered into court records on Monday afternoon. “At this time, I believe that if this offer turns into a sale that the court accepts, AWC will be in a position to retain its mission at its current location, although much work must be done to develop a viable African American cultural organization in the Pittsburgh community.”

The deal is threatened by a legal dispute over deed covenants and backlash from civic leaders. The city's Urban Redevelopment Authority, which opposes the sale, argues that 980's plan for a 10-story hotel tower atop the two-story building would violate use restrictions limiting the property to a black cultural arts facility.

The URA — along with Mayor Bill Peduto, County Executive Rich Fitzgerald and three foundations — want the center preserved as a “public asset.” It was built with at least $17.4 million in taxpayer money.

The center opened in 2009 and folded less than five years later as its debts ballooned. The center owes $7.96 million to Dollar Bank, and a couple of million to unidentified smaller creditors who, Judith Fitzgerald noted, continue to make demands for payment.

The debt to Dollar Bank increases daily because the bank foots the cost of maintaining and protecting the building while the receiver works on its sale. Dollar Bank has the right to foreclose or put the building up for bid if the deal with 980 deteriorates.

At the end of the month, Judith Fitzgerald will lay off two of three full-time employees working at the center. She is working to book events to help thwart a foreclosure and negotiating hourly compensation rates for staff needed for events.

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