ELKHART -- Thirty recreational vehicles built before World War II, a generous donor and a gentlemen's agreement combined to give the RV/MH Hall of Fame & Museum a premiere collection, new exhibition space and, now, a major financial headache.

The Hall of Fame owes an estimated $5 million and could close in a few months if the debt obligations are not met.

"Right now, I'd say we got two, three months of time to get this thing flying," said Tom McNulty, executive director.

The RV/MH Heritage Foundation board of directors has sent a letter to people identified as potential major contributors and is formulating a plan for resolving the crisis. McNulty declined to discuss elements of the proposal for moving forward, saying the plan was in an "embryonic stage."

RV/MH Hall of Fame & Museum executive director Tom McNulty seen during an interview at the facility Friday, February 18, 2011. The hall is running out of money and could be forced to close. McNulty is meeting with leaders in the RV industry and working with the RV/MH Heritage Foundation Board of Directors to develop a business plan to save the institution. The hall opened in August 2007 and saw 55,500 visitors through the doors in 2010. (Truth

Foundation board members are hoping to reveal their blueprint to select industry heads, elected officials and civic leaders at a special meeting some time in March. McNulty wanted to meet with RV executives personally but with the news that the Hall of Fame is in financial trouble, he is not sure he will even be allowed in their offices.

In fact, McNulty recalled a company president immediately saying he did not have $5 million when he first caught sight of the executive director. McNulty was able to convince the company chief to attending the meeting.

"It's here, we've got to face it," McNulty said of the financial crisis. "We've got to tell the story the way it is. That's the only way I know who to do this, so people understand we have a plan, or will have a solid plan. That's what we've got to get conveyed to the powers that be, the guys that could help us.

"Once they see that and are aware of what conceivably could happen, then I think we got a shot at (saving the institution). I honestly believe that, or, I wouldn't be doing this."

WRITING CHECKS

The Hall of Fame's predicament can be traced back to the purchase of the David Woodworth collection of pre-World War II RVs. Avid Hall of Fame supporter and founder of Teton Homes Corp. Robert "Boots" Ingram saw an opportunity to buy and wrote a check to the Hall so it could add the historic units to its collection, McNulty said.

Already using all the space available in Phase I, the Hall of Fame had to launch Phase II to have room to house the Woodworth collection, McNulty said. Ingram wrote another check and the Hall was able to secure a $1 million loan from 1st Source Bank.

That money was used for the construction of the new section which includes Boots & Betty Ingram Hall (home to the Woodworth collection), Champion Hall and Grand Hall.

In total, Ingram made a $2 million interest-free loan and a $1.1 million interest loan, both of which are due in 2012, said foundation board chairman Bill Garpow. The board has not been making payments on the loans but, Garpow said, it always assumed it could raise the funds when needed.

Apparently most of the money was loaned on a handshake and no formal terms were ever negotiated.

"As a matter of fact, it was only within the last two years that we even had notes signed by Boots and Carl (Ehry, former president of the Hall of Fame) and the treasurer," McNulty said. "The other, he just wrote checks. There were no notes, nothing. It was just an agreement between him and Carl.

"Finally we suggested you better have something to indicate that we owe you the money."

Taking out loans to build an addition was a change in the mode of operation for the Hall of Fame. Previously it did not make a purchase or start a project until it had all the necessary funding in hand.

McNulty said the board did not abandon its principles.

"This whole scenario was kind of thrown at us by Boots buying that collection," he said. "Now what do we do with it? We've got to put it somewhere. So that's how it transpired."

Both McNulty and Garpow insist the Hall always intended to repay the Ingram loans.

Two unforeseen events are hampering the Hall's ability to follow through. First, the economic recession hit causing donations to drop. Second, Ingram died in September spurring his family to demand the loans be repaid, in full, immediately.

"We have a moral and ethical obligation to the Ingram family," Garpow said.

He went on to explain the Ingrams are not the villains in this situation. The foundation board does not "want to cast dispersions on what Boots did or what his family is doing now."

Also, McNulty did not want the Hall or anyone associated with it to be blamed for the current turn of affairs.

"I don't want anything to happen that would in anyway suggest that there was impropriety," he said. "To me, that's non-productive."

OPPORTUNITY FOR INCOME

As one possible solution to the financial squeeze, the Hall of Fame is hoping to get a $6 million loan from the U.S. Department of Agriculture. The Hall has been working about a year on the application for this loan with terms of a 30- to 40-year repayment schedule at 4.25 percent interest, McNulty said.

Half of the loan, $3 million, would go to pay off 1st Source Bank completely, McNulty said, and what is left would go to retiring some of the Ingram loans.

The other $3 million will be used to help build the final phase of the Hall of Fame, the manufactured housing wing of the museum, and blacktopping 25 acres of land to the east. Making these investments would enhance the venue, McNulty said, and attract businesses and organizations would rent for events like RV dealer shows, boat shows and car shows at the Hall of Fame.

"That would be open to anybody," he said. "The intent was you can generate some pretty good sized money if you have the area."

As evidence of the Hall's popularity, McNulty pointed out the venue has booked twice as many events to date this year as it did in 2010. Also, last year, 55,500 people visited the Hall of Fame.

In addition, Garpow said a "service supplier in the industry" has committed to donating $1 million to the final phase once dirt is being moved.

U.S. Rep. Joe Donnelly D-2nd, wrote a letter in July to the USDA, requesting the agency approve the loan. He cited the development of a tourist attraction as a way to create jobs and sell local and regional products.

However, the Ingram family's requirements could undermine the Hall of Fame's chances of securing for that loan, Garpow said. As a condition of getting government funds, the Hall would have to name the USDA as the priority creditor. This means if the Hall would close and liquidate, the government would get repaid first and whatever is left would go to the family.

For the USDA to consent to giving the funds, the Ingram heirs would have to consent to being in the No. 2 position. At this point, Garpow said, the family does not want to be in the second slot.

SEEKING DONATIONS

How successful the Hall of Fame would be raising funds on its own to build the final phase may have been foreshadowed by a recent attempt. The Foundation board of directors had quietly tried to solicit contributions for the effort about five months ago. A letter and brochure were sent to donors, asking for assistance.

The institution was hoping to raise a "couple of million," Garpow said, but the response was "not even close."

Despite the disappointing attempt at fundraising, Garpow, like McNulty, still sees other avenues to take that may keep the doors open.

"It is definitely something that is not dead and buried," he said of the Hall of Fame. "It has a lot of opportunities. ... It is savable and valuable to the industry and community."