In other cases, cities have rescued aquariums before they had to pull the plug on them.
But COJ was drowning in so much debt, says Mayor Wellington E. Webb, that he couldn't justify keeping it afloat.
"It is disappointing that Ocean Journey, a private venture, was unable to succeed," Webb says. "While the city considered different scenarios to offer public assistance to Ocean Journey, in the final analysis, it was difficult to justify using public tax dollars to save a private venture that carried $63 million in debt, particularly while the city is making its own budget adjustments as a result of the slowing economy. It is certainly our hope that Ocean Journey will work up until the final moment to find a solution that would allow them to continue operating."
Ocean Journey officials say negotiations between the city and bondholders have reached what appears to be a permanent impasse.
"This is a sad event for the people of the Denver-metropolitan area and the state of Colorado," says Tom Gamel, chairman of the board of directors, Ocean Journey. "We have worked extremely hard to find a solution to the problem. Unfortunately, the facility cannot support the current debt of $63 million. Closure of Ocean Journey, a wonderful cultural and educational facility, is an extraordinarily disappointing event."
Based on current cash flow estimates, the board of Ocean Journey has decided to keep operating the facility through the spring break period to allow families, Ocean Journey members and others the opportunity to visit the facility before its final closure.
Ocean Journey's board of directors wants to emphasize that it has not given up on its mission of finding a permanent solution to the debt service problem. Negotiations will continue with bondholders and other parties during this interim period.
"A ground swell of support from the community may help all the parties in interest come to a resolution of the problem," Gamel says.
At the same time, the Board has instructed management of Ocean Journey to develop a contingency plan that will allow for an orderly closure of the facility.
"Although Ocean Journey has over $9.7 million in cash reserves, the bondholders have exercised their rights to freeze these amounts. As a result, the reserves are not available to the facility," says Doug Townsend, president and chief executive officer of Ocean Journey. "Even though the aquarium has $1.3 million in cash, approximately $1.1 million must be kept available to ensure that Ocean Journey can meet its financial obligations to employees and to ensure the health and safety of the fish and animals until they are placed in other institutions around the country."
Bondholders have liens on 12 of Ocean Journey's 17 acres. In addition, five of the acres back a $6.1-million loan from the US Department of Housing and Urban Development that Denver guaranteed.
The aquarium building is considered an engineering marvel. Most of the aquarium exhibits are on the second floor, which is unusual because of weight loads. Now, the single-purpose building may be razed and the land sold for development.
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