Music Center President to Resign, Will Stay on Board

The beleaguered president of The Music Center of Los Angeles County said Wednesday she will resign next July but, under a negotiated agreement, will serve as a paid consultant and retain a position on the center’s governing board.

“I just decided I could continue to serve the Music Center . . . in other ways,” said Esther Wachtell, who has headed fund raising for the downtown performing arts complex for five years.

Her resignation was jointly announced by Wachtell and Music Center board Chairman James A. Thomas after a special board meeting called to discuss her tenure.

“Esther was terrific, and trying to replace her will not be easy,” Thomas said.

Wachtell’s leadership has been a source of controversy since the center suffered a financial embarrassment two years ago when officials announced they had met their $17.6-million fund-raising goal but were actually $1.3 million short.

The turmoil intensified in recent weeks after Wachtell’s former top aide told The Times that he had been made a scapegoat for the financial problems. He accused Wachtell of spending lavishly and ordering accounting changes that made it appear that the center’s fund-raising goal had been reached.

Wachtell said the controversy had nothing to do with her decision to resign her $200,000-a-year post, effective July 15, 1993. But she acknowledged, “It is difficult to take the responsibility for raising the money when there is constantly somebody making allegations . . . even when those allegations are false.”

Since former Vice President James B. Black made his allegations in late October, Music Center supporters have privately discussed Wachtell’s leadership at Christmas parties, corporate luncheons, Music Center performances and even the long-awaited groundbreaking for the new Disney concert hall. Board members, who include prominent executives and socialites, debated whether Wachtell’s continued leadership would help or hinder fund raising.

The Music Center, already weakened by the poor Southern California economy, has been forced to reduce its fund-raising goals over the past two years and has cut its support to its four resident companies, including the Los Angeles Philharmonic and the Los Angeles Music Center Opera. The nonprofit arts center was built more than a quarter of a century ago on land leased from the county.

Wachtell, known as one of the premier fund-raisers in Southern California, said she had been considering resigning for “some time” and began to discuss the matter privately with Thomas, who is managing partner of the Maguire Thomas Partners development firm and owner of the Sacramento Kings basketball team. Her decision, she said, was finalized Sunday.

Wachtell, 58, said she decided to resign so she could spend more time with her family after devoting many years to fund raising for the Music Center’s resident companies.

“I have a new grandbaby, and I wanted to have Saturdays to play with him and most of the time I have to work on Saturday,” said Wachtell, who was named president in 1988.

Under terms of the resignation, Wachtell will become a paid consultant for a year to other center fund-raising efforts, such as the drive to build the Disney concert hall across the street from the performing arts complex atop Bunker Hill. Officials declined to discuss the financial terms of her consultant duties. In addition, she will serve on the center’s 70-member Board of Governors through 1996.

“We are thrilled that Esther is staying on and working with us,” Thomas said in an interview.

“Her shoes will be hard to fill, very hard, at a time that we really need all the expertise we can get,” said Ernest Fleischmann, executive vice president and managing director of the philharmonic.

The announcement followed three weeks of emotionally charged negotiations and conferences that some of the center’s board members feared could irreparably splinter the socially prominent cultural organization.

“I think this is the best that could have been done,” said one board member who steadfastly supported Wachtell. “I’m not happy, because I think the Music Center family came very very close to being torn apart.

“The moral fabric and the emotional strings were stretched to the limit,” said the board member, who spoke on condition of anonymity. “(Now) I think there has to be a time of healing and everyone will close ranks.”

Despite the controversy, the Music Center reached its 1991-92 fund-raising goal of $15.5 million and Wachtell said that the center is “on target” to reach its $14.5-million goal for 1992-93.

Efforts to work out a resignation agreement with Wachtell began Nov. 24. According to a variety of Music Center sources, Wachtell raised the possibility of leaving during a breakfast meeting of the board’s executive committee.

A subcommittee was formed to discuss transition terms with Wachtell. But several board members said the situation became more complicated during a full board meeting Nov. 30 at the Regency Club, a private Westside club owned by billionaire David H. Murdock.

During the meeting, sources said, Murdock demanded that the board give a vote of confidence to Wachtell, but Thomas blocked the effort, saying it was out of order. “Words were exchanged,” said one board member.

Thomas refused to discuss details of board meetings. Murdock did not respond to telephone requests for comment.

However, sources said that after the meeting, Thomas added Murdock to the committee that was working with Wachtell on the terms of her resignation.

The resignation package presented to the board meeting Wednesday was accepted without objection, Thomas said.

A year ago, the board gave Wachtell a unanimous vote of confidence, quietly put Wachtell’s top aide, Black, on a year’s paid leave of absence and ordered a thorough review of the center’s books.

The audit disclosed that no funds had been embezzled. It indicated, however, that center officials had installed new accounting techniques and used unrealistic estimates of potential income to show that the 1990-91 goal had been met.

Auditors concluded that board members never were told of the accounting changes, many of which were disallowed by auditors. The center had to borrow $3 million to make ends meet.

Wachtell disavowed any knowledge of the changes used to reach the goal.

But in October, Black told The Times that he was made the scapegoat. Wachtell, he said, ignored his repeated warnings to halt lavish spending and even ordered him to change the center’s accounting system to make it appear that they had met the 1990-91 fund-raising goal.