LIVERMORE -- The stage is set for the financially starved Bankhead Theater to become jointly owned by the city and Alameda County.

City officials announced Monday they had reached agreement -- along with the representatives from the Livermore Valley Performing Arts Center, county Supervisor Scott Haggerty and the Bank of New York Mellon -- on the framework for buying up the downtown theater's $22.3 million debt and transferring ownership to the city and county.

"The City Council has approved a conceptual deal to save the Bankhead Theater," Livermore City Attorney Jason Alcala announced to a standing-room-only crowd at council chambers, following a closed-door meeting.

The Volker Strifler Band plays to a large crowd during the free "Friday Nights LIVE!" concert held in front of the Bankhead Theater in Livermore,
The Volker Strifler Band plays to a large crowd during the free "Friday Nights LIVE!" concert held in front of the Bankhead Theater in Livermore, Calif., on Friday, Aug. 2, 2013. The free concerts are held on Fridays from 6:30 to 8:00pm until September 13th. (Doug Duran/Bay Area News Group)

Attendees, many of them decked out in red and white "Save the Bankhead" T-shirts, greeted the news with cheers and applause.

Under terms of the proposal, the Livermore Valley Performing Arts Center would continue to manage and operate the theater and the Bothwell Arts Center, pledging to contribute $4 million. Of that amount, $2.8 million will help settle the Bankhead's debt, with the rest going to fund operations through 2014 and catch up on standing financial obligations.

LVPAC board member Denise Watkins said the joint commitment could secure the long-term future of the Bankhead. It came not a moment too soon for the organization, which is set to unveil its upcoming season on June 26.

"We're all feeling like this is great," Watkins said. "Obviously we've got some things to do, (but) this is a huge relief and we believe we can make it work."

A deal is expected to be finalized within 90 days. Financial details are yet to be determined.

Kathy Streeter, a board member for the Livermore Commission for the Arts and chair of the Friends of the Bankhead and Bothwell, was enthused by the announcement. Her organization will throw its support behind fundraising efforts, she said.

"I think it means success for the theater," Streeter said. "We're here for the long term. They've made the commitment and they'll make it work."

Charles Hartwig, a board member for three resident groups using the theater -- the Rae Dorough Speakers Series, Del Valle Fine Arts and Pacific Chamber Symphony -- said the proposal affords the local arts community a measure of stability.

"We've had to think about where our future would be," Hartwig said. "(Now) we can all walk away and say the Bankhead is going to be there and we can move forward."

The specifics of Alameda County's financial input are still being worked out. Livermore's contribution will not come from its general fund, city officials said, but instead from future Host Community Impact Fees generated by the Altamont and Vasco landfills.

"We've got the conceptual framework from which we can come to an agreement," said Livermore Mayor John Marchand. "There's still a lot of moving pieces here."

Council members continued the matter to a future meeting date. Vice Mayor Bob Woerner said although negotiations are ongoing, the city is "guardedly optimistic" of a conclusion palatable to all parties involved.

"We've got a deal that allows everybody to move forward in a fairly seamless way," Woerner said. "It could've gotten a lot worse, but it didn't. ... This is a successful solution."

Moving forward, Watkins said LVPAC will hire a new executive director and lean heavily on fundraising to pay for the Bankhead's day-to-day operations. The organization, she said, is confident the renewed sense of security will encourage donors -- who held back in the face of the theater's possible foreclosure -- to contribute.

"We think this community will respond," she said. "We need people to not sit on the sidelines any more."

Contact Jeremy Thomas at 925-847-2184. Follow him at Twitter.com/jet_bang.