December 19, 2008
Los Angeles Museum Agrees to Accept Rescue Deal
By EDWARD WYATT
LOS ANGELES — The board of this city’s financially troubled Museum of Contemporary Art reached a preliminary agreement on Thursday to accept a financial rescue offer from Eli Broad, the billionaire philanthropist who was a founding trustee of the museum and is one of this city’s largest arts patrons, according to three people close to the board.
The agreement, which the board voted on at a long meeting Thursday afternoon, is not final and is subject to numerous conditions, including Mr. Broad’s examinations of the museum’s financial accounts, according to the people, two of whom attended the meeting on Thursday.
The people, who spoke on the condition of anonymity because the deal was not final and they were not authorized to talk about it, said that the museum’s executive committee was continuing to meet Thursday night to hammer out details of the deal.
They also cautioned that the agreement could fall apart and that a competing offer from the Los Angeles County Museum of Art for a merger of the two institutions had not been completely dismissed.
Museum officials could not be reached for comment Thursday night. In a statement issued at about 4:40 p.m. Pacific time on Thursday, the museum said: “The Executive Committee of the Board of Trustees is continuing to review the options presented to the full board today. MOCA anticipates making a further announcement as early as next week regarding the outcome of these discussions.”
Two people who were present at the meeting said that after a vote, the board authorized the executive committee to complete the deal. One of those people said the board favored Mr. Broad’s offer because “it allows us to remain an independent, ongoing museum.”
The offer from the Los Angeles County Museum would merge the operations of the two institutions and exhibit some of the contemporary museum’s work at the county museum’s campus.
The Museum of Contemporary Art has run into increasingly difficult financial straits in recent years as its fund-raising has failed to keep up with its spending and the museum’s management dipped into restricted funds in order to pay for ongoing operations.
As a result, the museum’s endowment has declined from more than $40 million near the beginning of the decade to about $6 million currently, according to people who have been briefed on the museum’s finances. The erosion of resources has been made worse by the recent declines in the financial markets, which have taken substantial bites out of the investment portfolios of many cultural institutions.
Mr. Broad offered last month to come to the museum’s rescue, offering up to $15 million in matching funds to help rebuild the endowment. He said he would give the museum one dollar for every dollar it raised. He also offered to give the museum $15 million over five years to pay for exhibitions.
The city’s mayor, Antonio R. Villaraigosa, urged the trustees of the Museum of Contemporary Art on Thursday to take another 30 days to conduct a public review of proposals to rescue their institution, which is facing a financial crisis. The board’s trustees met for the second time in three days to evaluate the two competing rescue offersBroad.
The mayor asked the museum to voluntarily invoke a clause in its lease on two city buildings that calls for the appointment of a panel of “contemporary art experts” to help oversee the museum if it breaches its contractual obligation to remain a “museum of ‘world class’ stature.”
Thursday, December 18, 2008
No word from LA Times, but this very good news just in from the New York Times: