About an hour southwest of downtown Portland, Oregon lies one of the most unique museums in the world – the Evergreen Aviation Museum. Comprised of a number of buildings that include a rocket collection, historic aircraft, a giant screen theater, a chapel, and an indoor waterpark, questions have been raised by a State of Oregon investigation into the financial interaction between the for-profit Evergreen International Airlines and the nonprofit Museum foundation.
The airline recently filed for Chapter 7 bankruptcy. It’s questionable how much effect this will have on the Museum, whose flagship attractions are an indoor waterpark, where riders enter slides from an actual 747 jumbo jet mounted on the roof, and Howard Hughes’ wooden megaplane The Spruce Goose. There had been concerns over payments on the Hughes plane, as the Statesman-Journal reported on December 22:
“[Museum Director Larry] Wood supposes [attorney Robert] Lyon’s client, the Aero Club of Southern California, could repossess the Spruce Goose. ‘I wonder if they have enough money to take it apart and get it out of the building,’ he said, however. ‘When I took this job in 2010, I didn’t know anybody owed any money on it. I found out when I met Mr. Lyon in California at a meeting. I said, ‘What?’’
“Lyon said [Museum founder Delford] Smith personally guaranteed a promissory note in 1992 backing purchase of the Spruce Goose. He said Evergreen recently made the last of 240 monthly payments – over 20 years – that totaled $500,000 for the plane.
“That account contradicts a fable repeated by docents that the museum bought the plane for $1. It lends credence to suspicions of former Evergreen pilots who believe Smith, 83, plowed company profits into the museum and water park, hastening the airline’s demise.
“But Lyon said the Aero Club is still due at least $50,000 – a percentage of the museum’s earnings, per the sales agreement – before ownership can be transferred to Evergreen through a complex stock-swap scheme.
“Who wrote the checks for the $500,000?
“’Interesting you should ask,’ Lyon said. ‘They came from Evergreen Aviation,’ rather than the museum.”
On January 20, CNN quoted Lyon as stating that the Aero Club has no intention of reclaiming the plane and that he believes a prompt resolution of payment is at hand.
Although approximately half of the museum’s aircraft are on loan from other museums, such as the National Museum of the United States Air Force and the Smithsonian’s National Air and Space Museum, the portion of the collection owned by the museum are at risk. Already, two aircraft that were used by the for-profit Evergreen Aviation as collateral to lease a Gulfstream jet have been listed at sale by a third party broker at a combined asking price of $2 million. The Gulfstream was repossessed when the for-profit Evergreen and associated companies defaulted on $17 million in payments.
It remains to be seen how the remainder of the Museum’s owned collection will fare as additional creditors, including hotels claiming non-payment for providing lodging services for air crews, continue to step forward and as the state continues its investigation into the for-profit company’s use of the nonprofit museum’s collection to secure financing for its operations.