THE IDEA TAKES OFF
After his meeting with Public Facilities District president Travis Snider, Barry Smith got right to work. He was aware of the Museum of Flight’s Paine Field project proposals in the 1990s and concluded that there were two key factors in finally bringing such an idea to life: convincing The Boeing Company to move into a new tour center in a facility that would also provide educational exhibits and programs, and finding a source of significant initial funding other than the county’s coffers or The Boeing Company. The recognition within The Boeing Company that its tour center needed to be upgraded and the possible availability of funding from the new Public Facilities District provided timely opportunities to successfully pursue the project. Mr. Smith discussed the matter with Museum of Flight President Ralph Bufano, who encouraged approaching the PFD. He also filled Mr. Smith in on the Museum's similar efforts in the 1990s, including the project name that was used: National Flight Interpretive Center.
Barry Smith began to attend meetings of the new Public Facilities District Board in order to learn about its processes and three initial projects. A crucial issue was whether there would be funds remaining for a fourth project. On August 17, 2001, Barry Smith appeared at the Public Facilities District Board meeting expressing his desire to make a presentation about the project to the Board. He also met with then Snohomish County Executive Bob Drewel, who became a supporter of the project. By md-2001 the Museum of Flight’s Executive Committee had appointed Eugene McBrayer (a member of the board of trustees) to form a committee to research the feasibility of the Museum operating this potential new facility at Paine Field. Mr. McBrayer scheduled a committee meeting for 9:00AM on September 11, 2001. Mr. Smith recalled:
“I was on bank business in San Francisco that day and arranged to join the meeting by conference call. At 8:45 that morning I received a call from a friend who said, ‘Can you get to a television? Turn it on immediately.’ I asked what channel and the response was ‘any…it will be on all of them….’ As it came on I saw the smoke rising from the first twin tower and watched in shock as another airliner impacted the second tower. I immediately called Gene. I said to him: ‘Gene, I suspect you’ve seen the news and I imagine you’re going to cancel the 9:00AM meeting.’ His answer stunned and inspired me: ‘Barry, if there was ever a time when leadership and commitment to commercial aviation was more needed, I don’t know it. The committee needs to support the interpretive center at Paine Field more than ever and I am not going to cancel our meeting. In fact, I am going to ask for a unanimous vote of support. Are you with me?’ I knew as he said that that he was so right. Immediately I said yes and said I’ll stay on the line to join the conference. The committee agreed with Gene’s recommendation and voted to invest Museum of Flight funds to retain the highly-regarded Seneca Group in Seattle to analyze possible financial structures to make such a private-public-nonprofit partnership business and charity feasible.”
Seneca selected Mike Stanley, P.E., to lead the project. He was experienced in complex development arrangements and was able to ascertain realistic probabilities about key partners’ abilities and commitment. He had the financial acumen to put this all in first drafts of a risk- and revenue-sharing scenario (augmented with studies by other consultants) that became the backbone of presentations about the project to the Snohomish County Council and to the Public Facilities District board.
Seneca’s analysis was also useful in presenting the project to upper management at The Boeing Company. After meeting with Ralph Bufano and learning about the project, the Boeing Everett Site General Manager, John Quinlivan, became another early supporter of the proposal. He arranged for Mr. Smith and Paine Field Deputy Airport Director Bill Lewallen to meet with the head of Boeing Commercial Airplanes, Alan Mulally, and his staff to explain the proposal. Mr. Lewallen presented the County Airport’s case for this real estate development and its potential positive impacts for Boeing. Mr. Smith described the potential for an exhibit gallery and educational programs, especially programs to interest young people in aviation careers. After soliciting his staff’s opinions, Mr. Mulally looked around the room, slapped his palm on the table and said: “I think we should do this!” Mr. Smith “knew then that we were launched.”
On September 25, 2001, Mr. Smith, several representatives of the Museum of Flight, and Mike Stanley of the Seneca firm presented the proposed project to the PFD’s Board. Dick Taylor of the Museum of Flight explained that the project would provide a new and important education resource for the county’s students. Mr. Stanley detailed the components of the proposal, including a restoration facility, exhibit space, an education center, a restaurant and a small theater. The team presented a letter dated September 25, 2001, from John Quinlivan stating The Boeing Company’s commitment to the proposal. The project team made several more appearances at PFD meetings, addressing legal, financial and business plan issues raised by the board.
At the PFD board’s November 16, 2001, meeting, the project team made a detailed presentation. Paine Field Airport Director Dave Waggoner provided an executive summary of the plan, which envisioned construction beginning in the fall of 2002 and the facility opening in mid-2004. The concept now included meeting rooms, food service, administrative offices, and aircraft exhibits, as well as the Boeing Tour Center. He also informed the board that County Executive Bob Drewel supported the project. Mike Stanley reviewed the forecasted positive financial results for the county. Barry Smith noted that there would be “minimal risk for Snohomish County and a tremendous return through tourist spending.” Boeing representative Dirk Fieldcamp reiterated the company’s desire that the project move forward.
Calling the PFD board’s February 8, 2002, meeting to order, President Travis Snider noted that the “Paine Field/Museum of Flight” team had submitted its business plan and the board would be evaluating the project’s viability. The team was allotted 30 minutes to make its presentation on that issue. Airport Director Dave Waggoner discussed changes that had been made to the plan to make it financially “very conservative,” producing a venture that would be “financially sound and self-funding.” He also introduced Deputy Director Bill Lewallen as the Airport’s project manager for the undertaking.
On March 1, 2002, Barry Smith and team members from Paine Field, The Boeing Company, and the Museum of Flight returned to the PFD board. Dave Waggoner submitted documents requested by the board, including business plan guidelines, a description of persons to be served by the education programs, and details of the conference center part of the project. He noted that while funding constraints had caused a reduction in the proposed size of the facility that would reduce revenue forecasts, the venture was still projected to generate a $40 – $45 million benefit in the county. He also emphasized that The Boeing Company would be making its lease payments for its tour center space “in the good and the bad times.”
On October 16, 2002, the Snohomish County Council adopted Motion 02-442, which approved the “National Flight Interpretive Center” concept, authorized the Paine Field Airport Director to spend up to $50,000 to develop a formal plan, and directed that the Public Facilities District’s authority be amended to encompass the project. The PFD staff reported this action by the county at the district board’s October 18, 2002, meeting, and advised that on November 4 the County Council would consider action that would confirm the PFD’s legal ability to fund the Paine Field project. He also “explained that there is a potential partner who would like to include a flying collection with the proposed project,” so the facility could be larger than currently anticipated.
Early on, representatives of Paul Allen’s Flying Heritage Collection participated in the discussions. The Microsoft co-founder was looking for a new home for his many historic aircraft, and early project concepts included building hangars for them as part of the Boeing Tour and aviation exhibits complex. Eventually that idea was dropped, and in 2008 the Collection moved into a renovated 1950’s hangar on the east side of Paine Field.
On November 4, 2002, the County Council approved Ordinance 02-066, which formally authorized the Public Facilities District to consider funding for the project. Before this amendment, the district could only fund municipal projects, not county projects. A year earlier, a first effort at such an expansion of the district’s authority had failed, one concern being that the amount of sales tax revenues available to the district would not support an additional project. By November 2002, council support for the project had solidified and sales tax revenues were up.
Barry Smith and Dave Waggoner attended the December 13, 2002, PFD board meeting to provide an update on the project. Mr. Waggoner reviewed the partners in the project and the facility’s size, costs, attendance projections, ticket prices, interest rates and net cash flow. He distributed a report titled Financial Impact of NFIC on Tourism. Barry Smith discussed private fundraising efforts in support of the project. The board’s consensus was to pursue the project, and it scheduled a December 20 meeting to delve further into the details.
On December 18, 2002, the County Council adopted Motion 02-529, which expressed continued support for the project and authorized the County Executive to submit a “National Flight Interpretive Center Application and Business Plan” to the Public Facilities District, albeit “with the express understanding that Snohomish County was not at that time formally committing to the development, ownership or financing of the” Center.
On December 20, 2002 the Public Facilities District’s governing board provisionally approved contributing funding to the project, subject to specified contingencies: (1) completion of a business plan by January 31, 2003, (2) completion of a financial plan by January 31, 2003, (3) obtaining non-contingent financial support from the county by February 28, 2003, (4) execution by March 31, 2003, of partnership and interlocal agreements between the National Flight Interpretive Center legal entity, The Boeing Company, the county and the Public Facilities District, and (5) producing a design and construction schedule by January 31, 2003.
In 2003 the project team continued to appear before the PFD board to present progress reports on the project and, specifically, on resolving the contingencies the board had specified.
In March 2003 The Boeing Company signed a letter of intent to operate its tour center in the new facility, and the Museum of Flight signed a letter of intent to manage an aviation museum and conference center in the facility. The County Council earmarked $22 million from a larger issuance of general obligation bonds to construct the facility.
On May 14, 2003, the Snohomish County Council adopted Ordinance 03-043, which formally authorized construction and operation of the “aviation museum and conference center” at Paine Field, leasing space in that facility to The Boeing Company for its tour center, and entering into an interlocal agreement with the Public Facilities District for the joint financing of the project. On May 21, 2003, the County Council adopted Motion No. 03-200, which approved the March 31, 2003 National Flight Interpretive Center business plan. The council approved a $1.9 million contract for the architectural design of the facility and approved a $388,000 construction management contract.
At its July 17, 2003 meeting the PFD board approved funding the project up to a cap of $5.5 million. At its July 25 meeting the board approved an interlocal agreement with Snohomish County for the project as drafted, and it unanimously approved a finding that the “the NFIC Project is a viable project.”
On December 17, 2003 the county and the Public Facilities District signed the “interlocal agreement for development of an aviation museum and conference center.” This formalized the county’s and district’s joint development of the project (with the county being in the lead) and the district’s financial support. The agreement recited several steps that had been taken on the project, including:
- The county retained the consulting firm The Seneca Real Estate Group, Inc. to develop and continue to refine the Aviation Museum and Conference Center Business Plan dated March 31, 2003;
- The county retained the consulting firm AMS Planning and Research to review the financial feasibility of the business plan, as well as independent consultant Paul Smith to analyze the donor capacity within the Snohomish County philanthropy market;
- AMS validated the financial feasibility of the business plan, including the assumed donated funds figure, which was within the philanthropic potential amount determined by Mr. Smith;
- The total development costs for the facility were estimated at $15.6 million, plus financing costs; and
- The county had obtained long term financing, and the annual contribution to the debt’s repayment by the Public Facilities District was set forth in Exhibit B to the agreement, the total upon the last payment in 2026 being $7,027,354.
In March 2004, the county and The Boeing Company entered into a Land and Building Lease for the portion of the new facility that would be used for the Boeing Tour Center. The agreement recognized that a new name for the facility was needed, and the parties agreed to work together to develop a name that would include “Boeing.”
On June 9, 2004, Snohomish County and the Museum of Flight Foundation (“Operator”) entered into a fifteen-year Aviation Museum and Conference Center [“AMCC”] Development, Operation, Management, Licensing and Exhibition Agreement. Under this lengthy contract, the Operator consulted with the county as the AMCC was being planned and constructed and, after it opened, was to operate the facility for the county. The Boeing Company, under its long term lease with the county, would operate its Tour Center portion of the building.
With the concurrence of The Boeing Company, the Museum of Flight and the Future of Flight Foundation, on December 9, 2004, the County Council formally approved changing the name of the new facility from the National Flight Interpretive Center to “Future of Flight Aviation Center & Boeing Tour.” This name had been recommended by a group formed by the County’s airport management, which worked with the Methodologie firm retained by The Boeing Company. At one of the group’s meetings Susan Bradley, a Boeing Communicator, had first suggested using “Future of Flight” in the name. Most of the members agreed with that idea, and Methodologie then developed a tagline, logo and branding color standards. This new name signified the solidification of the focus of the exhibit portion of the new facility as being forward looking rather than historical.