In an attempt to help Mystic Aquarium in difficult times, Connecticut officials announced Tuesday that the state is providing a $7 million loan to the aquarium that has been hit hard by the coronavirus pandemic.The popular tourism site in the state’s southeastern corner was closed from March 17 until July 1 as the virus spread across the state and has been operating at only 50% capacity since then.
Unlike other businesses that closed, the aquarium still needed to spend $1.5 million per month to care for 5,000 animals on a 24-hour basis at a time when they were receiving no admissions revenue.
Rather than simply providing a cash grant, state officials insisted on a multipronged approach that involved the aquarium raising more than $10 million from private donors and then eliminating $14.5 million in long-term debt from its balance sheet. The state will also receive two seats on the aquarium’s board and closely watch its fortunes.
“Mystic Aquarium is a great cultural icon for the state of Connecticut — what it means in terms of marine science, what it means in terms of tourism,” Gov. Ned Lamont said Tuesday at the aquarium. “Historically, the state ... would have gone out and borrowed $10 million and hoped for the best and pass things over until the next election. And that’s not the way we did it. This place is too important not to get it right."
Lamont said officials were looking ahead to ensure that the aquarium will be operating 50 years from now.
When asked how the state will respond if other nonprofit organizations seek similar cash infusions from the state, Lamont said, “Every situation is different. Connecticut is going to find a way where we can be a partner. ... I didn’t want to just throw money at the situation.”
As one of the state’s highest-profile tourism destinations, the aquarium attracts 800,000 visitors per year and employs 200 full-time and 100 part-time workers. But the attraction has been operating at only 50% capacity with 60% of its workers since it reopened. The facility relies on ticket sales for about 80% of its revenue, supplemented by grants and donations. The recent restructuring now means that the aquarium is debt free, said Stephen Coan, the chief executive officer of the nonprofit organization that operates the aquarium.
The deal was struck largely by David Lehman, a former Goldman Sachs banker who is Lamont’s chief economic adviser and commissioner of the state Department of Economic and Community Development. Lamont and Lehman have reversed the practice under Gov. Dannel P. Malloy’s administration of awarding large grants to major corporations in an attempt to create and save jobs. Instead, the state has relied recently on loans in public-private partnerships.
After the event, Lamont walked up to his top economic adviser and joked, “All right, Lehman. You made these guys debt free. How about the state of Connecticut?”