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July 06, 2015

Newseum Mulled Risky Fiscal Move to Tackle Pressing Debt

Burdened by more than $300 million in debt, the Newseum floated a plan last fall to sell shares in its seven-year-old building in the heart of Washington, D.C., offering investors a large "balloon payment" in 10 to 15 years, writes The Washington Post.

The museum devoted to journalism and the First Amendment would risk losing ownership of the Pennsylvania Avenue complex near the U.S. Capitol if it failed to "provide the promised return," according to a November memo detailing the proposal.

The memo outlined several other possible strategies to stabilize the Newseum's finances, including leasing its parking garage and refinancing part of its debt, to give its leaders time to launch a $250 million fundraising campaign. The museum, which relies heavily on money from the Freedom Forum, an affiliated foundation, has struggled with deficits since moving to its new, $477-million home in 2008 but has reduced spending and increased revenue in recent years.

The museum's chairman and acting CEO, Peter S. Prichard, called the November memo a "stale, outdated and incomplete" document and said it "does not reflect the significant financial progress the Newseum has made in the past year."