L.A. Theatre Center Near Financial Collapse : Arts: The downtown complex is ‘within days of closing its doors’ if there is no large cash infusion, officials say. City is planning no further bailout.

The financially troubled Los Angeles Theatre Center, which opened in 1985 as the cultural nucleus for the planned rejuvenation of downtown’s Spring Street, is “within days of closing its doors” and needs $500,000 by the end of August, officials disclosed Thursday.

Dropping the curtain on the theater would represent a major setback for both the Southern California artistic community and the city’s efforts to reclaim the dingy downtown neighborhood that was once the financial capital of Southern California.

In the last decade, the city’s Community Redevelopment Agency has poured nearly $27 million into the former bank building and high-tech, four-stage complex, including more than $5 million this week to acquire it from private bondholders.

City officials said they were surprised by the sudden disclosure, but said they plan to seek out other arts groups to perform in the center.

“There is always a chance that some angel will come through and save them,” said Adolfo Nodal, general manager of the city’s Cultural Affairs Department. But, he added, “the numbers look real bad.”

The complex at 5th and Spring streets is “beset by legal actions, tax problems and a general inability to do business,” according to a memorandum from theater founder Bill Bushnell and other top LATC managers sent Wednesday to the center’s board of directors,

“There are no more rabbits in our collective hats,” warned the internal memo, a copy of which was obtained by The Times. “It is our obligation to inform you that the Los Angeles Theatre Center is within days of closing its doors.”

The theater company can meet only part of an $88,000 payroll due today and has no funds for $50,000 in payroll commitments next week, LATC managers said. The management also does not know whether it can meet federal and state payroll taxes.

The staff memorandum said that since April the 34-member LATC board had made commitments to raise $350,000 in badly needed operating cash, but that it had only brought in $15,000. Board commitments in February had also fallen short, leaving the LATC with outstanding debts that have continued to grow and now approach $1 million.

Bushnell and sources close to the theater center said the short-term cash needs could only be met by big-dollar private donors, since a new infusion of city funds appears unlikely. The memo said that the center may be forced to close Aug. 11 if LATC does not receive an immediate cash infusion of $250,000. Officials said it needs another $250,000 by the end of the month to stay open.

“Do I see what a rational, logical person would call a ‘realistic chance?’ I do not,” said Bushnell, who has the title of artistic director, in an interview Thursday. “But one must remember that rational and realistic human beings are not necessarily theater artists.”

Even if the board had raised the promised $350,000, said LATC board member William R. Robertson, executive secretary-treasurer of the Los Angeles County Federation of Labor, “that would just be a delaying action.”

“I’m saddened,” he said. “LATC provided more diversity in theater.”

Mayor Tom Bradley, for whom one of the theater center’s stages is named, expressed regret that the company’s financial problems are critical. But in a statement issued through an aide Bradley appeared to write off any chance for further city support for the center as it is currently operated.

“The mayor is deeply saddened by the news that limited financial resources threaten to close the LATC,” a Bradley spokeswoman said. “However, the mayor has made a commitment to theater in the city of Los Angeles. (He) has directed the Department of Cultural Affairs to investigate the feasibility of developing (a new operating) consortium so that the facility will once again present the best in theatrical entertainment.”

Nodal of the Cultural Affairs Department confirmed that preliminary discussions had been held with at least three potential participants. They include the Center Theatre Group, which already operates the Mark Taper Forum and the Ahmanson Theatre at the Music Center of Los Angeles County. Other possible participants are college theater programs at California Institute of the Arts in Valencia and Cal State Los Angeles.

In any case, indications Thursday were that should the existing LATC company survive, it is unlikely to play the preeminent role at the downtown facility that it has until now.

City officials have privately suggested that LATC management has too frequently bemoaned its financial situation and lost the confidence of some at City Hall. The tactic has sometimes been seen as a ploy to induce the City Council to continue subsidizing the center even after the city’s $5.25-million purchase of the LATC building Tuesday.

“They are not crying wolf any more,” said Nodal.

Since the LATC was first proposed in 1982, the Community Redevelopment Agency has poured nearly $27 million into the project, including $20.4 million in construction costs, operating subsidies and other operating support.

CRA officials declined comment on the situation Thursday.

The theater center was intended to spawn a vibrant theater and arts district on Spring Street through a succession of CRA-organized projects. Only two of the planned projects have been completed--the Ronald Reagan State Building at 3rd and Spring streets and a nearby condominium conversion called Premiere Towers. The Reagan building opened this year, two years behind schedule. Sales of the Premiere Towers condos stalled and many of the units have been turned into rentals.

Restaurants and nightclubs that popped up after the theater center’s opening went bankrupt, and planned conversions of aging office buildings into artists’ loft complexes never materialized.

Last year, CRA officials, including Chairman James Wood, agreed that the city had largely failed to breathe life into Spring Street and that the LATC had been left to shift for itself along with the street’s growing homeless population and persistent crime. Wood said in an interview with The Times last year that what happened to the LATC represented a classic failure in urban planning.

The City Council voted May 28 to take over the complex in a complicated agreement that included paying off private bondholders and shifting maintenance fees to the theater company. The city hoped to ease the financial burden on the theater company by paying off the mortgage and assuming responsibility for the buildings. It also hoped to attract other arts groups to the complex. Escrow on the city’s purchase closed Tuesday.

“We’ve done as much as is humanly possible,” said City Councilman Richard Alatorre, who sponsored the city’s purchase of the property. He said he did not believe the council had been misled by approving the building deal when LATC was in such dire straits. “We knew it was an ambitious undertaking, and it wasn’t going to be easy,” Alatorre said. “It’s a serious blow to the city.”

Nodal said the city went ahead with purchase of the LATC building even though Bushnell had disclosed at a confidential meeting last week that short-term cash-flow difficulties might force the LATC to close. He said his agency elected to go ahead with the escrow closing because the city plans to open the complex to new producers.

However, Nodal said he was taken by surprise at the suddenness of the LATC’s apparent financial demise. The Aug. 11 date for a possible shutdown came as a shock, he said.

It was not immediately clear what effect the closure threat would have on two current productions, “A Bowl of Beings” and “True Lies.” The Latino comedy revue “Bowl of Beings” is scheduled to close on Aug. 11, and the performance-art anthology “True Lies,” which opened 10 days ago, is scheduled to run through Sept. 8.

The LATC: A Chronology 1975: Birth of Los Angeles Actors’ Theatre, which would grow into Los Angeles Theatre Center, on an East Hollywood side street.

1978: Community Redevelopment Agency spends $4,800 on a design for a theater complex on Spring Street.

1982: CRA acquires land on Spring Street, including a vacant bank building. Deed on building is transferred to LATC limited partnership. CRA issueds $4.8 million in certificates of participation for renovation and construction.

1985: LATC company moves to Spring Street and opens shows in September in each of the building’s four theaters. Jose Luis Valenzuela takes over the theater’s Latino Theater Lab. Charles Marowitz directs “The Petrified Forest.”

1986: Bill Bushnell launches an Arthur Miller trilogy with “All My Sons.” Other highlights: “I Don’t Have to Show You No Stinking Badges,” “Spain/36,” “Tartuffe.”

1987: CRA promises to spend $4.9 million over five years as a final commitment of facilities support. “The Film Society,” “Ma Rainey’s Black Bottom,” “Jacques and His Master.” “The Stick Wife” ends LATC use of the 99-seat Theatre 4.

1988: Black and Asian-American labs form. “The Kathy and Mo Show,” “Yankee Dawg,You Die,” “Roosters,” “The Inspector General,” “Kingfish.”

1989: Two years into CRA’s five-year subsidy, $4 million is already used up. “Demon Wine,” “Minamata,” “Eden,” “The Marriage of Bette and Boo,” “Once in Doubt.”

1990: Interim CRA funding is authorized while a panel appointed by Mayor Tom Bradley studies LATC’s fiscal future. Panel proposes city ownership of the facility, with subsidies for building maintenance, but political pressure restricts amount of the subsidies. “The Illusion” will go on to win six Los Angeles Drama Critics Circle awards. “August 29,” “The Joni Mitchell Project,” “Hip-Hop Waltz of Eurydice.”

1991: The city buys the building, paying off the 1982 bondholders, providing a final $750,000 for maintenance costs but requiring the LATC company to pay all such bills from now on. Other groups are invited to use 30% of the stage time. LATC wins eight Drama Critics Circle awards, its most ever. “My Children! My Africa!,” “The Rabbit Foot,” “Monster in a Box,” “A Bowl of Beings.” On July 30, escrow closes; on July 31, LATC officials say the company may have to close by Aug. 11.

SOURCE: Los Angeles Times