Auction Over: Baltimore City Cuts Itself a Deal

Baltimore City's auction of The Senator Theatre is over, and the way I see it, they cut themselves an unauthorized deal on Tom Kiefaber's property. Nobody I talked to foresaw that the City could set the minimum bid at less than the amount owed on the note on The Senator, or bid less than that approximately $950K themselves. I didn't know either of those things were even legal, especially given their fiduciary responsibility as trustee to try to maximize the auction sale price, and the fact that they claimed they were holding the auction to clear the debt on the theatre. Yet they did set the minimum bid lower and bid less, walking away with The Senator for a literal steal of $810K.

I assume they will now try to collect the rest from Tom Kiefaber, unless perhaps there was a higher reserve price that was not met and which the city will now consider paid off. It was not clear in the chaos that was this auction. If anyone knows, please enlighten me.

The auction was fishy from the beginning, with auctioneers from Alex Cooper auctions showing up early and immediately causing concern, but probably through no fault of their own. At least one person associated with the auction company appeared in my opinion to be clearly uncomfortable with their company being associated with such a tainted auction, and I heard when he assured Tom Kiefaber that they are a reputable company. No one was doubting that. They were just doing their job, however, when they were hired by the city to handle this property, they likely had no way of knowing what a corrupt process it was going to turn out to be.

First the auction company told us that the city might change the minimum bid after the beginning of the auction. Given that Kim Clark had said on record in public that bidders would have to bid $1 million dollars to outbid the city and buy the theatre, this came as quite a shock. Even then, I was thinking they would raise the maximum bid to prevent anyone from buying it, not lower it to cut themselves a deal.

Next, we learned that although there had been an agreement between the city, the auctioneers, and theatre management weeks ago to have the auction inside the theatre, they were going to move the auction outside at the last minute.

There was quite a commotion as the city tried to move the auction outside and Tom Kiefaber tried to get them to stick to their original agreement and hold the theatre in the air-conditioned theatre with a sound system, rather than outside in the heat on the sidewalk where there was no sound system and nobody could hear. Eventually, the auction started outside.

The city started the bidding at $750K, well below the published minimum bid that came out of the mouths of city officials, and well below the amount of approximately $950K owed on the note. There was a large crowd and no loudspeaker system. There were multiple shouts from the crowd of "I can't hear you," directed at the auctioneer. At least two people who said they planned to bid were so confused that they were still standing inside when the bidding started, and were brought outside by Tom Kiefaber. One or two other bidders bid it up to $800K, before being outbid by the city at $810K. The auctioneer seemed to rush through the process.

At the end, there were multiple shouts of "it was rigged," as well as tears and anger from members of the public who showed up to witness the auction.

The city does not yet officially own the theatre, as the auction still has to be ratified, which I hear will take approximately 45 to 60 days. Meanwhile, Tom Kiefaber is still the owner.

More later when I have a chance to process all this, upload some video, and find out more about what this all means.

Please note that this blog noted months ago, before the city's steering committee made their apparently pre-determined decision that The Senator could not be a non-profit, that it seemed that the city was trying to take The Senator from Tom Kiefaber and hand it over to some crony, in what seemed very likely to be a rigged process. That appears to be exactly how it's playing out. I'm not a psychic. I'm just doing my own investigation here. The dots are not that hard to connect.

Further Thoughts on The Senator's Conversion (Pun Intended)

Well, now that it seems Baltimore City officials have placed The Senator firmly on the track toward becoming an evangelical mega-church, how are they trying to undo the damage? By promising retribution after the fact.

The BDC's Kim Clark and 4th District Councilman Bill Henry recently threatened to control the situation by taking away The Senator's parking.

But she and Henry noted a deterrent to a congregation could be an existing agreement that allows for use of the parking lot across the street from the Senator only if the property remains in use as a theater.

Oh yeah. That's going to work real well (NOT!) --- let a church buy The Senator at auction and then try to take away their parking. This kind of meddling in a property owner's affairs may have worked to some extent to harass current Senator owner Tom Kiefaber, but do these city politicians really want to take on a whole congregation of churchgoers? Talk about a political landmine!

And what happens when the pastor realizes he can probably sue Baltimore City over constitutional issues related to church/state separation and remove ANY controls they try to put on use of The Senator, including the city's recent interior landmark designation?

But at least Bill Henry gave some insight into the city's thinking on this issue when, at a recent public meeting, he indicated the way they'd take away The Senator's parking is by making a deal with the owner of the Staples parking lot (currently also The Senator's parking lot), developer David Cordish, who Henry indicated has already agreed to go along with that.

On a separate, but related note, Bill Henry seems not to have gotten the message that Kim Clark, Joan Pratt and others agreed to at the May 20th meeting at The Senator --- the message about how it would be good for taxpayers if The Senator is sold at auction so the city can get its recent investment back (and its only investment in The Senator for the past 10 years).

If the goal is to get the city's investment back, why is Bill Henry trying to scare bidders away from the auction by pulling big numbers out of thin air and passing them off as estimates for the cost of renovations and upgrades on The Senator? This $500K number has no basis in reality, that I'm aware of. I'm sure it would be possible to spend that much over time, especially if doing a full restoration, but the cost to continue to run the theatre under new ownership would be nowhere near that. (I am speaking here as a volunteer who has been in the theatre for several hours almost every day for the past two months. Trust me, I have a good feel for the condition of the building.)

It's time for Baltimore City officials to recognize that the way to save the day in this situation is to come to the table with community leaders, the public, Senator owner Tom Kiefaber, and other interested parties, as they were requested to do back in January, and figure out how The Senator can transition into a non-profit multipurpose entertainment venue, and NOT a religious non-profit! Now, it's entirely possible that they planned to get around to that under the city's RFP process, but they made one miscalculation: they assumed nobody would buy The Senator at auction for over $1 Million. Now that it's clear that The Senator's national and international brand is worth a lot more than they bargained for, and that there are several probable bidders, time to rethink the game plan and do the right thing for The Senator while it's still possible.

Kim Clark's denial of her earlier Daily Record comments

You may remember that in a February 26, 2009 Daily Record article (which is unfortunately subscription-only at this point), Kim Clark of the Baltimore Development Corporation made comments that amounted to defamation of Senator Theatre owner Tom Kiefaber, saying he had never made it work. As I recall, this article set of a whirlwind of negative media attention on Mr. Kiefaber that began to resemble a lynch mob.

Interesting, then, to note that Kim Clark now denies having made those comments. This video is from the May 20, 2009 meeting at The Senator. I know I've posted videos from this meeting before, but in this new one from Arlette Productions, you can actually hear Kim Clark's denial, which was off-mic.



At the end of the video, when asked about her comments in the Daily Record, Kim Clark can clearly be heard to say "I was misquoted. I didn't say that. That's not what I said. I don't talk to that reporter anymore."

The Kim Clark Show at The Senator Theatre

My title is a bit tongue-in-cheek, but last week's community meeting at The Senator Theatre and subsequent Baltimore Sun articles have revealed Kim Clark of the BDC to be an interesting, complex public figure with nuanced opinions and a flexible, changeable mind. If one were being unkind, one might say flip-flopper.

Now that I and others have videos and audio of the highlights of the meeting put together, let's examine the many conflicting opinions of that multi-faceted personality known as Kim Clark.

First of all, if you only have time to watch one video of the meeting, let it be this one from Arlette Productions. This highlights the discussion about the city's CHAP designation, which Kim Clark called "ill-timed" and "unnecessary," saying she had "in other people's face discussions" about it. I would have thought you only have "in other people's face discussions" if something is really wrong with what's happening.



But Clark softened her view about CHAP after the meeting, according to the Baltimore Sun.

Wednesday, both Clarke and state Sen. Joan Carter Conway, who called the meeting, questioned the timing and wisdom of the commission's action. But Friday, Clarke sounded less concerned: "I don't think it's as much of a roadblock as some people portray it to be."

Clark has changed her position about the likelihood of the theatre being sold at auction, too. In the meeting, she said she thought it unlikely that anyone would bid a million dollars for the theatre at auction, something she was strongly questioned on, given the extraordinary value and unique nature of The Senator.



After the meeting, she said that at least two parties with the necessary resources are interested.

Clark said she has heard from at least two prospective bidders -- one from Maryland, one from outside the state -- with the financial wherewithal to pay at least the minimum price for the theater. Plus, she said: "I'm hearing from other parties that they have been contacted. There seems to be definite interest out there."

OK, now to be fair, it may be there has been sudden interest since word of the auction got out that is surprising to Kim Clark, though not at all surprising to those of us who know and love The Senator Theatre.

But still, given that she does seem to change her mind a lot, can we really take her seriously when, confronted with the fact that her comments in a Daily Record article a couple of months ago made it seem that someone in city hall may have a personal grudge against Senator owner Tom Kiefaber, she claimed to have been misquoted? Her comments in the Daily Record set off a negative slew of nasty defamation of Tom Kiefaber that derailed the focus on The Senator from finding an appropriate solution to its future, by the way. Here you can (barely) hear her denying that she ever made those comments (she was off-mic for the denial). The comment she responds to with her denial can be found starting at about 4 minutes into this video:



What a fascinating character she is. Complex is the word, I believe.

Conflict at Senator Theatre meeting

This is a key piece of video from the community meeting at The Senator Theatre last week. More controversy over the CHAP action and the city's actions. Video courtesy of Arlette Productions.

Baltimore Sun makes sense twice in one day - will wonders never cease?

Imagine my suprise when I found out that the Baltimore Sun actually printed two things today that make sense --- a letter to the editor and an article about The Senator.

Here's the letter:

Kiefaber deserves respect, appreciation for his contributions

May 23, 2009

From Philadelphia, I have been watching in dismay the saga of Baltimore's Senator Theatre and, especially, the pillorying of longtime owner Tom Kiefaber.

I am a fan of historic cinemas, a keenly interested fan who frequently posts at websites like www.CinemaTreasures.org, and I am an active member of the Theatre Historical Society of America. As a volunteer, since 2002, I founded and have led a nonprofit organization, the Friends of the Boyd, Inc., which is seeking to ensure that Philadelphia's last movie palace, the Boyd Theatre, is restored and reopened. All of that means that I am a fan of the gorgeous and very historic Senator Theatre and a fan of Tom Kiefaber. I have been to the Senator Theatre on three different occasions, starting in 2001, to enjoy movies there.

Nowhere in the world is it easy to continue to operate a single screen movie theater, and too many single screens are just not feasible. For the last few decades, Kiefaber did it with aplomb. He put the Senator Theatre on the worldwide map of historic cinemas. He's made sure the Art Deco theater is physically maintained and that it glows with excitement. On my visits, the Senator has been a magical place. Moviegoers enjoy the backlit glass blocks of the exterior, the splendid rotunda lobby which often features interesting historic exhibits, the well stocked concession area, and a movie with state of the art sound and perfect projection on the large screen. Unforgettable is a trip to the handsomely decorated men's room suite, finding that you get to hear the movie through piped in speakers.

Kiefaber has worked hard to attract world premieres and film festivals, and he has shown mainstream blockbusters, art-house films, and classic movies. Unfortunately, the construction of so many mainstream movie megaplexes and art-house cinemas in the Baltimore area has rendered the Senator, with its huge single auditorium, no longer profitable as a theater that shows movies 365 days a year.

There must be other kinds of programs and events at the Senator. That's not Kiefaber's fault, as the same thing happened in many cities. The movie operator poured his heart and soul into the Senator. In recent years, he increasingly turned to the community for support as he literally went the extra nine yards, even putting his house up as collateral. He isn't one of those businessman who only "play with other people's money." He loves the Senator so much that he stuck his own neck out.

From what I've read, there seems to be a rush to eject Kiefaber forever and totally from the Senator. Everybody recognizes that the theater needs a new business model, one that might bring in concerts and other live events that will serve the community. To survive, the Senator will likely need to be owned by a nonprofit organization, with donations and volunteers. Nonprofits operate many theaters worldwide, with tremendous success.

Hopefully, there will still be some place at the Senator for films, such as Hollywood style movie premieres, film festivals, classic films, and maybe some first run films. That kind of mixed program is our goal for the Boyd Theatre in Philadelphia, and has worked in cities worldwide. But, Baltimore should not "toss out the baby with bath water." Kiefaber is the expert authority on the Senator, the star player who has worked with the theater building, the community and the film industry. He's a hero, not a villain. Long before many historic cinemas were saved by nonprofit organizations, Kiefaber was working super hard to make the Senator Theatre a cherished local movie theater. He deserves gratitude, and a role to play in the future of the gem that is the Senator Theatre. Please treat him with the respect he deserves.

Howard B. Haas, Philadelphia

Thank you, Howard B. Haas!

Then there's an article by Chris Kaltenbach that makes sense, too. Kim Clark doesn't necessarily make sense when it comes to the CHAP decision, which she seems to have changed her mind on, but that's not Kaltenbach's fault.

The Senator Theatre will continue showing movies and playing host to other events in the coming weeks, even as the city prepares to put the 70-year-old North Baltimore landmark up for auction.

Owner Tom Kiefaber plans to continue showing a slate of older films (such as Stagecoach, playing through May 28) until a new owner is found. He also plans to open the facility for other uses, including concerts and private gatherings, to show potential buyers the "great vitality" of the Senator.

"If you've ever had the fantasy of sitting in the theater by yourself, with everything cranked up, now is the time to approach us," he said.

The city officially purchased the troubled theater's $950,000 note from 1st Mariner Bank on Friday, said Kimberly A. Clarke, executive vice president of the Baltimore Development Corp. The date for a foreclosure auction will be set next week, she said.

"They generally take about 45-60 days," she said, "so we're hoping to have the auction by the end of June."

Unnecessary and Ill-Timed: Baltimore City's CHAP action on The Senator Theatre

See why Baltimore City's CHAP action on The Senator Theatre is costing the taxpayers almost a million dollars that could have come from private investors. Senator Theatre owner Tom Kiefaber, members of the public, State Senator Joan Carter Conway, and Baltimore Development Corporation (BDC) Executive Vice President Kim Clark all agree: CHAP's actions were unnecessary and ill-timed.

A Reporter Gets Something Right on Senator Theatre!

Adam Bednar of the Messenger, move to the head of the class! A reporter finally got something right on The Senator Theatre. (Sorry to be so snarky, but local media reporting on this issue has been largely dismal.)

Mr. Bednar caught one of the key issues that came up in Senator Conway's meeting last night: even other agencies within Baltimore City government don't like the CHAP board's recent action to list the interior of The Senator on its Special List.

A quote from the article:

Where one city agency sees protection others see interference.

During a meeting Wednesday at the Senator Theater about the historic theater’s immediate future it was clear that the Commission for Historical and Architectural Preservation made an unpopular decision to place the theater’s interior on a special protective list.

Tom Kiefaber, the owner of the Senator Theatre, Kim Clarke, executive vice president of the Baltimore Development Corporation, and State Senator Joan Carter Conway all called the addition of the Senator to CHAP’s Public Interior Special List a roadblock to the financially troubled theater being sold. Kiefaber owes First Mariner Bank, the mortgage holder, $950,000.

“We thought the CHAP designation was unnecessary and ill timed,” Clarke said.

The special list is a stopgap measure that requires any owner of the theater to seek CHAP approval before it can alter the building’s interior while the Planning Department and the City Council consider whether or not to name it to Baltimore City’s Public Interior Landmark List.

“I perceive (the designation) as a barrier to get the dollars we need for the property,” Conway said.

Kiefaber, during the CHAP hearing last week and during Wednesday’s meeting, said CHAP’s actions scared away two parties that were interested in buying the Senator earlier this year.

Had those negotiations come to fruition, the entire debate about whether public dollars should be used to secure the theater would be moot, Kiefaber said.

The article goes on to note that Councilman Bill Henry, who was not at the meeting, is still in favor of the CHAP actions. Henry claimed he was too busy to come to last night's meeting, but was found just after the meeting at the neighboring Zen West restaurant hanging out and getting a report from other city officials.

Just Back from State Senator Joan Carter Conway's Meeting at The Senator

Well, I just got back from State Senator Joan Carter Conway's meeting at The Senator Theatre. Before I say anything else, let me just say a BIG THANK YOU to Senator Conway for calling the meeting and helping us get some semblance of answers from some of the city representatives for the first time in this process. There are still a lot of unanswered questions, and there seemed to be still some obfuscation of the real motives (fancy way of saying lying) going on by some of the city players, but it was obvious that Senator Conway gets it and is not afraid to stick up for constituents and work hard to get to the bottom of what is really going on here. Truly appreciated!

I got audio of the whole meeting and video of some key parts of it. Others did too, so some of this will be up on YouTube in the next few days. Unfortunately, the media outlets got their soundbites and left before the real interesting stuff came out, so it's hard to see how they'll report what really happened, since by the time things started getting interesting, they weren't there.

The city was at first still trying to say they will own the theatre after they buy the note, but got immediately corrected by several audience members pointing out that they will own the mortgage, not the theatre. We were then able to get city officials such as Comptroller Joan Pratt and the BDC's Kim Clark on record repeatedly as admitting that there will be a foreclosure auction on the theatre (probably in about 60 days, according to a lawyer from the city). They also publicly committed to widely publicizing the auction, which since they've been apparently trying to hide the fact that they are having one up until now was quite unexpected.

Many members of the public spoke out to say there is clearly a hidden agenda here on the part of the city, which Kim Clark denied, but those of us who have been volunteering in the theatre and close to the situation know the hidden agenda exists.

Tom Kiefaber and others also managed to put in front of a wider audience the facts about the CHAP process scaring away private investors that would have saved the theatre and prevented the necessity of the city spending this money. An audience member spoke up to bring out James "Buzz" Cusack's conflict of interest on the CHAP board, since he has expressed an interest in buying the theatre. When Kim Clark quickly pointed out that Buzz had recused himself, I was able to reveal that another commissioner, Bob Embry, abstained from the vote at the CHAP meeting after his own conflicts of interest were pointed out, but had reportedly been driving the whole process up to that point.

Score some points for the good guys! This meeting got a little truth out there at last. More to come on YouTube.

Tom Harris and Mimi Shelley's video of what has happened to so many theatres in Baltimore, and what happened to the Mayfair after Baltimore City took it over, was premiered before the meeting, and that will be up on YouTube soon too. If that video doesn't make you cry, I don't know what will.