Iacocca, Hodel Clash Over Who Pays Fete Bills

A behind-the-scenes dispute between Lee A. Iacocca and Interior Secretary Donald P. Hodel has developed over who will pay the final bills for the four-day centennial celebration for the Statue of Liberty, The Times learned Tuesday.

Liberty Weekend officials said the tribute may have cost as much as $32 million, offset in part by the $11-million sale of television rights to ABC and foreign broadcasters.

The rest of the cost was to be paid in large part from ticket sales, but attendance was disappointing at the closing sports and entertainment salutes to the statue, and the size of the final deficit is still unclear. Thousands of tickets were given away to help fill the stands.

Sends Letter

Just before Liberty Weekend began, Hodel sent a letter to Iacocca, chairman of the Statue of Liberty-Ellis Island Foundation. Hodel stressed that it was his understanding that money raised from individuals or corporations would be used only to refurbish the statue and Ellis Island, and not to pay for any festival deficit.

Hodel’s message was repeated Tuesday by David Prosperi, the Interior secretary’s spokesman. “The secretary feels every child that contributed nickels and dimes to the restoration of the statue expects the money to be put towards restoration,” Prosperi said.

A spokesman for Iacocca said, however, that the foundation has a memorandum of agreement with the Department of the Interior that specifically states that the money the foundation raised will be used not only to restore the statue and Ellis Island but also to “celebrate the centennials of each.”

“It was always the intention of the foundation to do both, restore both the monuments and to sponsor the centennial celebrations,” the spokesman continued. He cited the Chrysler chairman’s remarks at his Manhattan press conference last Wednesday just before the festivities where Iacocca said the foundation would cover any shortfall from ticket sales during the celebration. “It may cost us a few million,” Iacocca said at the time. “That doesn’t bother me.”

Cites Brochures

The Iacocca spokesman added that the Statue of Liberty-Ellis Island Foundation’s brochures and other literature used to approach donors or corporate sponsors “made clear the money to be raised would be used for the restoration and the celebration.”

“We don’t have the numbers yet. The books aren’t closed,” the spokesman for Iacocca said. “When we have the numbers, we will decide what comes next.”

On July 2, the same day Iacocca held his New York press conference announcing that the foundation had raised $277 million, including about $5 million from schoolchildren, Hodel wrote Iacocca a “Dear Lee” letter:

“Various newspaper reports, some of which purport to quote Mr. David Wolper, (the Liberty Weekend producer) indicate that the Statue of Liberty-Ellis Island Foundation may be contributing substantial monies toward the expenses of Operation Sail and that if the expenses of the other events of Liberty Weekend are not offset by television revenues, ticket sales or contributions from individuals willing to donate money, that difference would have to be made up by the foundation.

‘Repeated Assurances’

“In view of the repeated assurances from you and other foundation Liberty Weekend officials that no contributions to the foundation intended for restoration of the Statue of Liberty or Ellis Island would be used for the Liberty Weekend festivities, I think it is important that we be sure those assurances are carried out.

” . . . I feel that as important as the planned celebration is, those individuals and companies making contributions to the foundation have a right to rely on the representations that Liberty Weekend would not be paid from funds to restore the statue and the island. I therefore hope that you will see to it that foundation monies not be used for Liberty Weekend.”

In his letter, Hodel volunteered to work with Iacocca to raise money if any shortfall should occur. “I would be happy to work with you in separately raising the necessary amounts,” he wrote.

Earlier this year, Hodel had fired Iacocca as chairman of the government advisory commission on the Statue of Liberty’s restoration. Hodel charged at the time that Iacocca would face a conflict of interest if he headed both the government advisory commission and the voluntary foundation to raise funds.

Repeated in Chat

Prosperi said that Hodel had repeated the gist of his letter when the Interior secretary and Iacocca chatted on July 3 just before opening ceremonies on Governors Island.

He said that the secretary had understood that Iacocca had assured him at that time that the foundation money would not be used for any Liberty Weekend deficit.

“As an American citizen,” Prosperi said, “the secretary wants people to have the right to rely on the representations that were made that Liberty Weekend would not be paid for from funds raised to restore the statue and the island.”

The Interior Department authorized the foundation to raise funds for the restoration of the federally controlled statue and island, but “in terms of leverage (in the control of expenditures), Interior really doesn’t have leverage over a private foundation,” Prosperi

Will Face Problem Later

When asked what Hodel would do if the private foundation ignored his request and gave Wolper the money, Prosperi replied: “We’ll cross that bridge when we come to it.”

Wolper said in an interview that he had just learned of Hodel’s letter on Tuesday. “The foundation is handling all the financing,” Wolper said. “What the foundation comes up with, it will come up with.”

The spokesman for Iacocca said the Chrysler chairman “wanted to thank Don (Hodel) for his offer to raise money. But he (Iacocca) doesn’t have the final numbers in hand yet.”

Iacocca could not be reached for comment Tuesday.