A worsening financial crisis at the Southern Oregon Historical Society will require shutting down its Jacksonville museums for six months and laying off most of its staff to restructure an organization that is the guardian of local history

A worsening financial crisis at the Southern Oregon Historical Society will require shutting down its Jacksonville museums for six months and laying off most of its staff to restructure an organization that is the guardian of local history.

"We will close most of the operations," said Terrie Martin, president of the SOHS board.

On Sept. 7, the museums as well as the research library in Medford will be shut down, historical society officials said Thursday.

The historical society's money problems began when it lost all of its county support in 2007 as part of a lawsuit settlement. Lithia Motors, a tenant in the History Center in Medford, will move out in October, ending a lease that generated $150,000 annually and canceling its option to buy the building.

A $600,000 line of credit taken against the History Center in the old J.C. Penney building almost is depleted.

Despite the problems, historical society officials vow to reorganize and develop a plan over the next six months.

Allison Weiss, who has been the executive director for six weeks, said shutting down the museums does not mean the historical society is closing forever.

She said the board approved her decision to suspend operations and lay off staff. She said the decision came after talking to several staff members who encouraged her to take these steps. With the line of credit ready to run out, Weiss said immediate action was necessary.

"To me this is the responsible thing to do, not the desperate thing to do," she said.

Seven people were laid off. Some of the staff people who supported these measures lost their jobs. "They saw the preservation of the society as more important than the preservation of their jobs," she said.

The organization will be run for the next six months by Weiss, a full-time farm manager, a part-time archivist, two part-time educators, a part-time maintenance worker and a part-time office manager.

Weiss said the historical society's situation didn't come as a surprise, noting that other nonprofits are seeing the effects of the economic downturn as well.

"I knew the organization had problems coming into the job," she said. "This is not blindsiding me."

In the future, she said the historical society will need to do a better job communicating with residents about its efforts and fundraising needs.

During the next six months, she will be preparing a vision statement that will set the groundwork for a fundraising campaign.

Weiss said the historical society will need to lease or sell the J.C. Penney building for the organization's long-term survival.

One key challenge is renegotiating a 50-year lease with the county that obligates the historical society to pay for the maintenance on county buildings. The society pays the county $1 a year for the lease.

"A big part of this is to ask the county to amend the lease in some way," she said.

Commissioner Dave Gilmour said it was difficult to talk about amending the lease until he sees what the historical society is proposing.

"I'm not opposed to it, but I would like to see the terms," he said. "It's pretty nebulous at this point."

If the society is no longer able to manage the buildings, Gilmour said it would be the county's obligation to take over their maintenance, even if they were mothballed.

He said the historical society hasn't done a very effective job increasing its paid membership over the past several years.

"They haven't been very aggressive," he said.

Weiss said one of her goals is to rebuild the organization by increasing its donor base and establishing partnerships with the community.

She will be meeting with an accountant today to get a better picture of the society's finances.

From July 2008 to April 2009, the historical society had a budget of $534,579, but had to tap into a line of credit for $148,789 to meet expenses.

Now the society, which once had a $2 million budget, no longer can rely on its line of credit or income from the Lithia lease. "All that leaves a very small amount of revenues," said Weiss.

She wants to get more of the historical objects out for public view while remaining mindful of balancing preservation with education.

Weiss said she has heard a lot from people about the way the historical society used to operate or about past grievances, but she said she wants to put all that behind her as she focuses on the organization's future and change the way it has operated.

"This is a very outdated way of running a historical society," she said. "History is only relevant if it is connected to the present."

Reach reporter Damian Mann at 776-4476 or dmann@mailtribune.com.