The group that will now manage the Chattanooga Zoo couldn't find loan forgiveness Tuesday, but it did come up with an agreement to help it repay some of the money the zoo owes.
On Tuesday, the City Council approved a lease and management contract with Friends of the Zoo to operate the facility and also approved a loan agreement with incentives to help pay down the zoo's debt.
"The city is giving them incentive to retire the debt," said Dan Johnson, Mayor Ron Littlefield's chief of staff.
Friends of the Zoo originally offered to take complete control of Chattanooga Zoo if the council would forgive a $1.7 million debt. It was one of several alternatives proposed to make it easier for the nonprofit to take over.
Under the new arrangement, for every $2 the zoo raises for capital improvements, the city will match $1, up to $250,000 a year.
Friends of the Zoo will pay a minimum $150,000 annual payment to the city for a term of 11 years, with the loan beginning on July 1, 2011, the Friends of the Zoo said in a news release.
"We were pleased that the city provided incentives that will allow us to complete our mission, repay the city and build financial stability for one of the City's most important assets," Friends of the Zoo board President Gary Chazen said in the release.