City Will Fund LATC Into January : Stage: The $998,390 appropriation is approved after officials and the center’s artistic director exchange words over finances and artistic aims.

Funding of Los Angeles Theatre Center through January was approved Wednesday by a 9-4 vote of the City Council--after the theater came up one vote short on Tuesday.

The $998,390 appropriation was approved in a council chamber that was packed by 200 LATC supporters, including actors Tony Geary, Philip Baker Hall and Richard Lawson and directors Reza Abdoh and Jose Luis Valenzuela.

The money will enable LATC to stop dipping into production funds to pay overhead--a practice that began Oct. 6 after previously allotted city funds ran out.

LATC officials said Tuesday that approximately $40,000 had been drawn from production funds in the last 10 days to pay for such items as utilities, security, insurance, minor supplies and repairs and salaries of key technical personnel, house managers and computer systems managers, box office staff and janitors.

The City Council action followed an exchange of charges Tuesday, in which Councilman Zev Yaroslavsky said the theater was financed by “junk bonds,” Councilman Ernani Bernardi said the theater offered “junk culture,” and LATC artistic director Bill Bushnell accused Yaroslavsky of spreading “the big lie.”

The council voted 7-5 in favor of the LATC money Tuesday, but eight votes were required to take action. The sponsor of the motion, Councilman Richard Alatorre, was absent Tuesday, recuperating from a kidney stone condition, as was another LATC supporter, Councilwoman Joan Milke Flores. Alatorre and Flores were present Wednesday, and LATC opponent Bernardi was absent, changing the tally to 9-4. The most surprising votes were cast by Council President John Ferraro, usually an LATC supporter. He joined LATC opponents in both votes.

In debate Tuesday, Yaroslavsky used the phrase “junk bonds” to refer to the $4.8 million in Certificates of Participation issued in 1982 to help finance construction of the theater. Referring to a $388,031 payment on these bonds, due Dec. 15, which will be taken from the $998,390 approved Wednesday, he objected to the “bailing out of the people who bought these very questionable” certificates. “They bought a pig in a poke.”

The debate continued Wednesday, with Councilman Marvin Braude pressing officials of the Community Redevelopment Agency, through which the city’s LATC funds are channeled, for a list of the bond holders. “I want to know who’s going to get the taxpayers’ money,” he said.

CRA Administrator John Tuite replied that the list of bond holders was held by the trustee of the certificates, Security Pacific Bank.

The bond holders are “people all over the country who bought $5,000 units in a legitimate form of mortgage financing,” said LATC Artistic Director Bill Bushnell after the Wednesday meeting. The certificates are “not junk bonds, which have nothing behind them,” he said. “These certificates of participation have the

(LATC) building behind them.”

Bushnell added that the property is assessed for tax purposes at $13 million-$14 million, and he disputed a contention voiced by Braude that the building would still have to be used as a theater if the bank were to foreclose. “That caveat would no longer hold if the CRA were out of the picture,” he said.

Councilwoman Joy Picus defended the LATC Tuesday as “vital to the future of Los Angeles.” Noting that she recently visited several theaters in Eastern Europe, she said these theaters are not in danger despite the financial problems of their state sponsors, and she urged Los Angeles to provide similar support.

But Councilman Nate Holden replied that such Eastern European governments “are upfront about how they’re funding (theater), and they have control over the operation of it.” Holden endorsed Yaroslavsky’s use of “junk bonds” to describe LATC financing and questioned why the bonds were sold with a 12%-13% interest rate. “What we need is an investigation,” he said, “not only by the City Council but by the district attorney.”

Braude asked CRA officials why other groups were not considered for the $998,390. “I don’t know who made this obligation” to LATC, he said.

The obligation was not only to the theater, said Councilman Hal Bernson, but also to “the resurrection of Spring Street,” the depressed area where the theater is located.

Bernardi attacked LATC programming--something that even the theater’s chief antagonist, Yaroslavsky, has carefully avoided in public debate before the council. “Not only are you talking about junk bonds, but you’re also talking about junk culture,” he said. He compared LATC unfavorably to “the highest type of culture--and that’s across the street (from City Hall) at the Music Center.”

Councilwoman Gloria Molina called Bernardi’s remarks “disgraceful.” She cited LATC’s productions of plays by women and minority writers and said LATC productions are “top-quality--they’re at least entitled to that credit.”

After the Tuesday meeting, Bushnell had harsher words for LATC opponents.

“Yaroslavsky perpetuated a big lie,” he said, referring to the “junk bonds” phrase. “It’s a buzzword interpretation, a know-nothing approach that gets picked up by other council members. . . .

“It’s appropriate that I’ve just (directed) ‘The Crucible’ (Arthur Miller’s play about the Salem witch hunts), which is based on a big lie.”

The council will soon consider the LATC’s long-range future, after a commission appointed by Mayor Tom Bradley issues its recommendations. A spokesman for the mayor’s office said Wednesday that the report was still being finalized by the commission and will go to Bradley by the end of this month or early next--a month later than expected.