Not quite a Hollywood ending at the Senator

It's easy to see why the city's sale of the Senator Theatre gave Comptroller Joan Pratt heartburn. The city paid $810,000 for the movie palace three years ago and this week sold it for a $310,000 loss. Worse yet, the city is hardly washing its hands of the seemingly snakebit property. It will hold the mortgage — and charge a minuscule 2 percent in interest. The city is putting up an additional $700,000 loan to the theater's new owners, who are also receiving a loan from the state and another from a bank. Too much debt brought the Senator to the brink of failure several times before, and if it does so again, the theater will be right back in the city's hands.

Ms. Pratt voted against the deal (the other four members of the city's Board of Estimates approved it), and she isn't the only one criticizing the arrangement. The opposition largely centers on two somewhat contradictory questions: Is the city throwing good money after bad, and is the city giving the new owners — father-daughter team James "Buzz" Cusack and Kathleen Lyon — a better deal than it gave to the theater's former proprietor, Tom Kiefaber?


Mr. Kiefaber's grandfather built the Senator, and for two decades he was synonymous with it. But he has lost nearly everything in recent years — control of the theater he devoted his life to and even his home, which he had put up as collateral. In a particularly ignominious turn, he now faces charges of trespassing at the Senator, whose new owners accuse him of harassment. A year after getting kicked out of City Hall for attempting to hijack a City Council meeting, he was back on Wednesday to raise his objections to the Senator's sale.

Mr. Kiefaber kept a single-screen, independent movie theater alive, and that is no small feat. But he hardly did it alone. The city began helping the theater directly in 1997, when the Schmoke administration provided a $20,000 grant and a $20,000 loan to help Mr. Kiefaber develop expansion plans and repair the building. In 1999, Baltimore provided a $180,000 grant to repair the air conditioning. In 2002, the Baltimore Development Corp. guaranteed half of a $1.2 million loan to refinance the Senator's debt and help Mr. Kiefaber renovate the theater at the Rotunda, which he owned at the time. In 2009, the city offered $320,000 if Mr. Kiefaber turned the theater into a nonprofit, but that never came to pass.


That was, however, only a fraction of the overall assistance Mr. Kiefaber received over the years. In 1993, developer David Cordish helped Mr. Kiefaber and his partners secure a loan to pay off debts related to the development of the Staples store across the street from the theater, which prevented foreclosure proceedings against the Senator. In 1999, the Abell Foundation and the state Department of Housing and Community Development gave him loans of $375,000 and $385,000. The DHCD kicked in another $10,000 loan the next year. In 2000, an anonymous benefactor helped prevent the Abell Foundation from foreclosing over unpaid mortgage and tax bills. Reports at the time put the gift at about $90,000. In 2007, Mr. Kiefaber raised about $110,000 in community donations to again pay delinquent mortgage bills.

If that answers the question of whether Mr. Kiefaber got a fair shot, it adds to the urgency of the question about whether the Senator is a wise investment for the city and state. If all that assistance never allowed Mr. Kiefaber to do more than keep his head above water — and ultimately not even that — what reason do we have to believe that Mr. Cusack and Ms. Lyon can do better?

For one thing, they already are. The Senator is closed for renovations now, and the partners are moving forward with plans that will spruce up the main theater and add three more screens and a small cafe. It's the sort of plan Mr. Kiefaber talked about for a decade or more but was never able to pull off. Mr. Cusack and Ms. Lyon have done it before — at the Charles, which they also operate. They have put up nearly $1 million of their own money for the renovations and have also secured a variety of historical tax credits, a common practice for redevelopment projects in the city.

After it reopens, likely in the spring, the Senator will still have a heavy debt burden and stiff competition, including from a 16-screen multiplex Mr. Cordish is building a few miles up York Road in Towson. But the new Senator will have more than nostalgia, charm and a stunning big screen going for it. The business model Mr. Cusack and Ms. Lyon are employing works in Station North, and it can work in Belvedere Square. The terms of this deal provide the conditions the theater's new owners and the BDC believe will make the nearly $3.5 million renovation and expansion possible. The city, state and community have sunk too much into this theater and the neighborhood that surrounds it not to let them try.