State Theatre renovation Act I: Behind the scenes

The not-for-profit State Theatre Foundation has weathered some hard blows from the public since asking the town of Culpeper in September to give $1.5 million toward restoration of the old vaudeville movie house on South Main Street.

Last week, foundation board members sat down in the theater office to debunk what they call rampant misinformation surrounding the request and to make their case for why a municipal investment in an arts center would be a very wise outlay of town funds.

“You’ve heard about the five myths surrounding health care reform?” asked IT consultant Tad Loving, vice chairman of the board. “Well, how about the 75 myths around the theater?”

Here, then, is some information about a project desperately trying to catapult downtown Culpeper into its next renaissance.

The public is watching

In numerous signed letters to the editor and anonymous online postings in recent weeks, several community members have blasted the State Theatre Foundation’s request, saying Town Council should not spend that kind of money when daily economic conditions for so many people are so dire.

Though that point may be valid, the foundation points out, many of the comments opposing a town contribution to the State Theatre rehab were unnecessarily mean-spirited and flat out misinformed.

On the other side, groups like the Culpeper County Chamber of Commerce have whole-heartedly endorsed the $1.5 million request because of the State Theatre’s potential, once operational as a live arts center, to boost local business activity.

A dozen downtown business owners, in addition, publicly endorsed town backing of the theater rehab as key to the continued success — and survival — of historic downtown.

Last month, in supporting Town Council’s vote to delay action on the funding request, Mayor Pranas Rimeikis said he wanted to give the public a chance to weigh in on it. Well, he got what he asked for, as people are definitely talking.

Raven Yates, foundation director, said the request for government funding is not so unusual.

“There are over 400 members in the League of Historic Theaters, and I haven’t talked to one that hasn’t had some funding for their localities,” she said last week.

First, some background
In 1938, State Sen. Benjamin Pitts of Fredericksburg opened the 532-seat theater in Culpeper as part of his Pitts Theater chain. It was built in the art deco style and is the town’s only example of such architecture.

The Pitts Theater was renamed the State in 1973 when Regal Cinemas took over. For nearly 55 years, it served as the town’s primary movie house.

In 1993, it closed when it was sold to The Finders, a secret society led by Culpeper native Marion Pettie. It’s hard to say what happened in the theater during its use by The Finders, though the group is said to have held meetings there.

The building soon became blighted and closed to the public for more than a decade.

Five years ago, the State Theatre Foundation came on the scene and took ownership of the building with an eye toward restoring the place back to its former glory. Since forming, the foundation has raised $8.1 million toward the estimated $9.65 million rehab and expansion project.

Local banks won’t finance the two-year construction project, however, until a full commitment of funding is in place.

The foundation, wanting to take advantage of low construction costs, approached the town about pledging $1.5 million so work could start.

They made the case, eventually, that the money was “an investment” in the town’s future that would yield great return year after year in increased local taxes and business activity.

Here, the foundation puts facts to its claim and sets the record straight.

Who owns the theater?
Myth No. 1: The prominent Yates family of Culpeper owns the State Theatre.

Fact: The State Theatre is owned by the State Theatre Foundation, a 501 (c) (3) group led by an all-volunteer board of local professionals with backgrounds in law, banking, government, athletics, computer technology, construction, the arts and property management.

Raven Yates, former business owner, lobbyist and political campaign manager, is the foundation’s paid director, and she has a part-time assistant.

Local developer and Culpeper native Greg Yates, her brother, initially purchased the old movie theater in 2004 from The Finders for $300,000 after Pettie, the group’s leader, died the year before. The deal went down in June 2004 in Yates’ Main Street office, in the building next to the Regal Theater.

At the time, the State had been closed to the public for more than a decade and was in danger of demolition. At one point, Culpeper Town Council, tired of the blight, considered buying the property itself.

In 2006, Yates and his wife, Liz, donated the theater to the State Theatre Foundation, transferring the deed into the nonprofit group’s name.

Greg Yates is chairman of the foundation board; the entire board will manage and oversee operations of the theater, operating as a nonprofit foundation.

Greg Yates owns the parking lot adjacent to the theater that he acquired through a land swap with the town in 2006. Per his agreement with the town, he must develop the property with a tax-generating commercial project. Greg Yates plans to develop the adjoining property after the theater rehab is substantially complete, according to his sister.

Going forward, the foundation will be responsible for raising funds for operations, as is the case with most other community-run theaters.

In addition, Raven Yates’ part-time salary is not paid with donations for the construction project. All donations pledged for the estimated $9.65 million construction project will be used as such.

“There is no Yates Foundation,” said foundation board member Steve Southard, senior vice president at Virginia Community Bank and former Culpeper County treasurer.

“Greg does not own this building. It is owned by the foundation. As a nonprofit organization, our revenues, balance sheet and income statement is public information.”

“We are not sitting here pulling numbers from the sky,” he added of why the restoration project would be in the town’s best interests. “We have done a lot of research, and this is why we believe it will work. Now, if somebody doesn’t think it will work, don’t just scream, ‘It’s going to bankrupt the town.’ Show us why it’s not going to work — do your homework, do your numbers.”

Investing in the future
Myth No. 2: The State Theatre Foundation is asking the town of Culpeper for an immediate $1.5 million infusion of cash.

Fact: The foundation is asking the town to commit to an “investment” of $1.5 million in the project, over time, through a scenario common in most other small-town cultural arts center projects. In turn, the board said, the town would make back its money in increased tax revenues for years to come.

“The town investment doesn’t have to happen until the building is close to being built,” said vice chairman Loving. “We just need the commitment now.”

Two years from the theater opening, he projected, the town would start to get its money back through increased local tax revenues. The foundation board is certain the local stimulus will happen based on what has occurred with similar projects elsewhere.

It’s an economic development issue, said Loving, asserting that various IT businesses are looking at Culpeper right now for relocation because of Terremark, an international data company, recently setting up shop here.

“One of the things they are interested in is quality of life,” he said. “We are beginning to become a target location for high-tech businesses. But if we don’t offer the quality of life, they’re going to go somewhere else.”

Pick up tomorrow’s Star-Exponent for the rest of the story.