Hammer Museum Seeks $13 Million From Japanese

The Westwood art museum being built to honor industrialist Armand Hammer--limited in money it can get from Occidental Petroleum Corp. by a court settlement--is attempting to secure $13 million from an unidentified Japanese corporation, according to newly released court documents and museum officials.

At the same time, court documents indicate that start-up costs and the first-year operating budget for the museum have increased to more than seven times the amount Occidental Petroleum projected in 1989, when it obtained tax-exempt status for the museum from the Internal Revenue Service.

The $60-million museum is officially known as the Armand Hammer Museum of Art and Cultural Center. Occidental is under a court-approved limit of $96 million in total financing for the controversial museum named for the multinational oil company’s 92-year-old founder and chairman.

When the museum was first planned, the Westwood-based company said it would absorb start-up costs of $1 million.

But a newly released deposition of Hillary Gibson, the museum’s fund-raising and financial director and a close Hammer associate, shows that initial expenditures have increased to $7.5 million--which the company said has been paid from income produced by a $36-million endowment annuity.

The increase appeared to reflect higher than expected costs associated with preparing the museum for its scheduled Nov. 28 opening. The art center plans to open with an exhibit of work by Russian Suprematist artist Kazimir Malevich, organized by the National Gallery of Art in Washington and which opened there earlier this month.

Gibson’s March 20 deposition was originally a confidential part of the court record in a lawsuit by Occidental shareholders opposed to museum expenditures. It was unsealed Thursday by the Delaware Supreme Court under recently altered rules that limit secrecy in appeals.

The court is considering an appeal from a Delaware chancery court judge’s August ruling that Occidental directors acted properly in approving financing for the museum, which is to house the art collection amassed by Hammer and paid for with Occidental corporate money and Hammer’s own funds.

In the deposition, Gibson was asked if the $1-million figure previously advanced by Occidental as its budgeted start-up costs for the museum was accurate as of late March. “No, it is not true,” Gibson said. At the time of the deposition, the settlement that included the $96-million cap had been agreed to by Occidental but was not yet approved by the court.

Gibson declined in the deposition to identify the Japanese firm or to say whether it does business with Occidental. Gibson said negotiations over the $13-million transaction involved a payment schedule for the contributions.

Gibson and Occidental spokesman Frank Ashley again declined to identify the Japanese firm or its business relationship with Occidental in a telephone interview Thursday.

The Gibson deposition also detailed ambitious museum fund-raising plans, including a proposed series of 20 “hard hat and caviar parties” at which wealthy museum patrons would don construction gear as they mingled in the unfinished museum drinking vodka and Champagne and eating caviar and hors d’oeuvres.

Occidental said 15 of the hard hat events have been scheduled and that the events began this week--though Gibson said the hard-hat attire had become only symbolic for persons attending the parties. Another event described by Gibson last March--a private dinner party for the USC School of Architecture--was held Thursday evening.