Helsinki rejects proposal to build Guggenheim museum on waterfront

Helsinki rejected a proposal to build a 140 million euro ($185 million) Guggenheim museum on the Finnish capital's waterfront, a notice on the city's website said on Wednesday.

The Helsinki City Board, a vetting committee of 15 municipal politicians selected to consider proposals for the Helsinki City council, voted eight to seven against putting the Guggenheim project forward for the council's consideration.

"The City Board rejects the project" it said on the Helsinki city website under the heading Decision bulletin no. 17.

Finnish media said the project was voted down over worries about governance and costs. The decision comes during an era when government budget cuts to contend with a debt crisis and a weak economy are sweeping Europe.

The Solomon R. Guggenheim Museum and Foundation, which oversees the original Frank Lloyd Wright-designed museum in New York and four overseas sites, made the proposal for the new contemporary art museum.

Its director, Richard Armstrong, said the museum would have benefited the city. "When the Solomon R. Guggenheim Foundation was invited to conduct the concept and development study, we accepted the commission in the belief that Helsinki offers many exciting possibilities. Over the course of a year, our team confirmed this initial premise, concluding that a Guggenheim museum would contribute significantly to Helsinki's cultural landscape," he said is a statement on Wednesday after the decision.

"We would have liked to develop the idea for the museum one step further, through an international open architectural competition - but as we emphasized from the start, our study had no predetermined outcome. All the same, we remain committed to the possibility of being in Helsinki."

The Guggenheim said it chose Helsinki due to strong local interest and tradition in art and design, as well as the city's plans to develop its harbour properties.

The Guggenheim -- which also has museums in Bilbao, Venice, Berlin and Abu Dhabi -- noted that Helsinki lacked a significant modern art collection, a gap it said the museum could fill and help draw tourists.

It proposed a museum be built on a city-owned site in Helsinki's south harbour, and recommended the city move forward with an architectural competition.

The museum could have opened in 2018 after around three years of development, it said, adding that its 140 million euro estimate included the construction and design of the building.

The museum would also have needed public, private and corporate funding to cover operating costs.

Finnish culture minister Paavo Arhinmaki took a sceptical view towards the project's funding. He assumed Finnish taxpayers would end up paying close to 100 million euros of the construction costs.

"It is also worth considering whether Finnish taxpayers should finance a rich, multinational foundation in the first place," he wrote on his blog after the initial proposal.