However city management's management memo also attaches a document -- Attachment B -- signed by Urban Commons Queensway LLC's Taylor Woods which indicates that the estimated cost of certain needed repairs is approximately $5M to $7M. In that document, Mr. Woods states that "Urban Commons remains dedicated to its partnership with the City of Long Beach and to the long term preservation, maintenance and development of the historic ship on behalf of the residents of and visitors to the city" while recognizing "that historic preservation will be costly and that it will require certain creative partnerships to develop the funding to make needed repairs."

City management's memo to the Mayor/Council leaves unlear exactly what, if any, "creative partnerships to develop the funding" to make the needed repairs city management may now be discussing with Urban Commons (which at some point could presumably come to the City Council for approval.).

[Scroll down for further.]

Sponsor

Sponsor

City management's memo indicates that Urban Commons has contracted for certain exterior paint and joint repair work, developed a "supplemental maintenance plan" to "remove standing water, investigate and repair water intrusion sources, and reapply rust inhibitor where needed" and indicates that Urban Commons will fund these items without tapping City-funded "Historical Preservation Capital Improvement Plan [roughly $23 million, now depleted, from a debt bond plus reserves], part of the transaction to which Council agreed in November 2016 when it authorized (Price dissenting) entering into a 66-year year-lease with Urban Commons to operate the ship and develop its adjoining land into "Queen Mary Island."

City management's memo says Urban Commons has a "bid" of $4.8 million from an independent contractor to perform certain additional critical side-shell repair work and life boat removal. City management's memo says the City will work with an independent engineering firm to confirm the scope of work, timing and cost and said the "City is confident that Urban Commons now has a plan in place to resolve the remaining structural issues identified in the Marine Survey..."

Sponsor

Sponsor

In an attachment to city management's memo, Taylor Woods of Urban Commons states that his firm "will work with the City to explore using funds based on the ongoing income sources created at the outset of our lease and that the "estimated cost of all the items above is approximately $5M to $7M based on the scope of work provided" and adds:

"Although the organization has learned a great deal about the challenges associated with maintaining a historic asset such as Queen Mary, Urban Commons remains dedicated to its partnership with the City of Long Beach and to the long term preservation, maintenance and development of the historic ship on behalf of the residents of and visitors to the city. We recognize that historic preservation will be costly and that it will require certain creative partnerships to develop the funding to make needed repairs."

Sponsor

Urban Commons also submitted to city management a Feb. 2018 report for the ship's hull and tank top which it says "continues to support the fact that the ship is structurally safe and in no danger of being unsalvageable."

City management also tells the Mayor/Council that it has hired an independent firm to conduct a peer-review of inspection reports provided (for roughly twenty years) by a city-retained engineer [whose monthly reports have grown increasingly critical of the ship's maintenance and condition.] The memo indicates the "peer review" is expected to be completed in mid-November.

Regarding financial documentation, city management's memo says Urban Commons provided the City with a draft copy of an audited consolidated financial statement for 2018 and a summary of the "Base Maintenance and Replacement Plan" (BMRP) fund account deposits and balance. City management's memo says the "independent auditor notes concern about cash flow, liquidity and overall debt load" but said the 2018 financial statement indicates a $24 million (67% increase) in revenue generating activity (compared to the year before Urban Commons took over) and revenue has increased from about $36 million in 2015 to over $60 million in 2019." City management indicated it's engaging accounting expertise to assist with reviewing the draft audited financial statement.

City management's memo also indicates that some "external media publications" [unnamed] had misrepresented the city's Oct 1 request for information from Urban Commons as a "notice of default." [LBREPORT.com wasn't among them; we accurately reported that city management had sent Urban Commons a fix-it-or-risk possible default letter.] Management's memo also indicates that news stories elsewhere about the ship's condition and the city's letter led to the company temporarily halt trading of a real estate investment trust it formed to raise private investor funds which had a brief but significant impact on the value of the real estate investment trust's stock.

Sponsor

Sponsor

Help keep our independent news going and growing in Long Beach. No one in LBREPORT.com's ownership, reporting or editorial decision-making has ties to development interests or other special interests seeking or receiving benefits of City Council development-related decisions; or holds a City Hall appointive position; or has contributed sums to political campaigns for Long Beach incumbents or challengers. No one in our ownership, reporting or editorial decision-making has been part of the governing board of any City government body or other entity on whose policies we report. LBREPORT.com is reader and advertiser supported. You can help keep really independent news in LB similar to the way people support NPR and PBS stations. We're not non-profit so it's not tax deductible but $49.95 (less than an annual dollar a week) helps keep us online.