City Council to Decide on LATC Fate This Week : Theater: The city may opt to buy its first major municipal theater complex. If the plan is voted down, the production company could be homeless.

The Los Angeles City Council will decide this week on one more multimillion-dollar bailout of downtown’s long-troubled Los Angeles Theatre Center.

The council will vote on a complicated and controversial plan to use about $6 million of city funds to buy Los Angeles its first major theatrical complex and to help one of the city’s foremost theatrical companies out of its chronic financial difficulties. The council will also decide whether to commit the city to managing the four-theater Spring Street facility and making it available to other performing arts groups.

If the purchase plan is voted down, the LATC’s building--which anchored an effort to revive a blighted neighborhood--will probably go up for sale, and the production company could be homeless.

The proposal clearly separates the Theatre Center itself from the theatrical company that has occupied it since 1985. City officials say the plan will purchase an asset for the city while forcing the company to live or die on its own.

With this week’s vote, “we exit the political process,” said LATC managing director Robert Lear. “We will not be back in the council. . . . We are on our own.”

The city is planning a few one-time-only payments to keep the building up as well as a $150,000-a-year grant, but officials estimate that LATC will still have to raise more than $3.65 million a year to keep operating.

LATC “will never get close to raising the money it needs” and will come back to the city asking for help, declared City Councilman Zev Yaroslavsky, the plan’s fiercest opponent. Yaroslavsky calls the proposal “the Gulf of Tonkin resolution for the raid on the (city’s) Arts Endowment.”

Supporters of the city buyout say it will “lift the clouds” that have hung over the theater complex since it opened nearly six years ago.

The facility, centered around a former bank building with new auditoriums added, was planned as the initial centerpiece of a massive East Downtown redevelopment effort. A Hollywood theater group headed by artistic director Bill Bushnell, with strong help from Mayor Tom Bradley, put together a proposal to bring live theater to the area, and a limited partnership associated with the theater was given title to the building.

But estimates of the ability of the Theatre Center to pay for the real estate costs were wrong. While the theater attracted nationwide attention for its adventurous programming, the city’s Community Redevelopment Agency had to contribute a total of $21 million to keep the doors open.

The current crisis arose last fall when the CRA, its funds for paying the building’s mortgage depleted, skipped a payment and the facility went into foreclosure. A City Hall commission reviewed the LATC situation and came up with a plan for municipal ownership of the building. Bradley endorsed most of the proposal, which is now before the council.

Two council committees are scheduled to vote today on the plan. The chairman of one of them, Joel Wachs, said Sunday that he is undecided. The chairwoman of the other committee is LATC proponent Gloria Molina. A full council vote is slated for Wednesday.

The plan calls for the CRA to spend up to $5.25 million to pay off 1982 construction bonds that were issued at a crippling 12 3/4% interest rate. The CRA will pay another $750,000 to help maintain the building.

The city’s Cultural Affairs Department will then take over management of the building, collecting a dollar a year in token rent from the production company and making 30% of the time on LATC stages available to other groups.

The proposal also calls for the city to provide $150,000 a year to cover costs incurred by the other groups using the complex, and that, said opponent Yaroslavsky, is “the nose in the tent, the foot in the door” that will drain the city’s new multimillion Arts Endowment.

“I don’t think the mayor would support that,” responded Deputy Mayor Mark Fabiani. The $150,000 will not come from existing endowment funds, he noted, “and it’s not as if the endowment funds can be called on automatically by the operators of the Theatre Center. . . . The mayor’s position is that it’s time for the Theatre Center operators to sink or swim.”

That doesn’t mean Bradley has ended his support of LATC’s private fund raising; he will co-chair a major fund-raising campaign for the theater. It means, said Fabiani, that “for the first time, the Theatre Center understands that the (building) subsidy has run dry.”

The city’s annual $150,000 facilities grant “is for other groups to be represented there,” said Adolfo Nodal, head of the Cultural Affairs Department. “I love the LATC, but I have a strong commitment to make sure this money gets spread around the city. If they can’t make it, then they can’t make it.”

LATC’s Lear believes the company will manage. It is prepared to raise ticket prices, and the LATC board aims to raise $2 million a year, up from $1.7 million last year. Lear believes council action will spur contributions.

In addition to the LATC board’s efforts, Bradley’s separate campaign will be vital. “A public/private LATC campaign committee,” co-chaired by Bradley and a corporate CEO, will try to raise $5 million over the next three years, said Lear.

Longtime Bradley nemesis Yaroslavsky is not impressed. “Tom Bradley is not going to live forever,” he observed. “He probably won’t be there in 10 years to pick up the phone to some Japanese developers and say, ‘Let’s help the Theatre Center.’ ”