COLUMN ONE : Disney Hall: Unfinished Symphony? : The dream of a ‘world-class’ music facility is entangled in so many financial problems that its future may be in jeopardy.

The 1997 grand opening of Walt Disney Concert Hall, the new home for the Los Angeles Philharmonic, was to be no ordinary night at the Phil.

The Frank O. Gehry-designed building, with its undulating white limestone curves, would be launched with a new work by American composer John Adams and multimedia staging by director Peter Sellars.

And the front-row guest of honor would be Lillian B. Disney, Walt Disney’s elderly widow, whose 1987 gift of $50 million would have made it all possible.

In 1992, that was the dream for the hall, which was to be built on county-owned land on Downtown’s Bunker Hill. Yet today, Disney Hall is not only years from construction, it is in danger of never opening its doors.

Now expected to cost $200 million--$90 million more than 1992 estimates, the project lacks $100 million in funds and has been halted since November. The Los Angeles County Board of Supervisors is expected to decide by the end of March whether to abandon Disney Hall or continue to work with its project team to see it built.

In a last-ditch rescue effort, a high-profile volunteer from the Los Angeles business community has been brought in to oversee the project and launch an aggressive new fund-raising effort.

Disney Hall will reach a major crossroads Friday when a recently hired management company, Houston-based Hines Interests, is expected to release definitive cost estimates for a project that has operated without them for years.

Whatever the projected cost or fund-raising target, hall builders will no longer be able to turn to the project’s chief benefactor.

Diane Disney Miller, daughter of Walt and Lillian Disney, says the family will not give any more money than it already has promised.

“Absolutely, I don’t see how we can--nope!” she said. “I don’t see how we can, not from where I sit. I regret that the gift hasn’t accomplished more.”

That a project backed by one of the most famous families in the country and supported by some of the most prominent Southern Californians should flounder remains shocking to all involved.

“I’m aghast that it has gone this far, for this long, and we have so little to show for it,” County Supervisor Zev Yaroslavsky said. “I couldn’t think what would be worse for the image of the county than to have this thing fall through.”

In a region that suffered riots, earthquakes, recession, fires and floods, Disney Hall could represent a sign of recovery. It could also be a landmark, an investment in the cultural and economic future of Los Angeles.

“We need a cause that becomes the soul of this town, that allows the cultural life of this city to coalesce,” said Robert B. Egelston, board chair of the nonprofit Music Center, the county’s showpiece Downtown theater complex, which would include Disney Hall.

“We ought to be growing up to these challenges. We’re a big-time town, the cultural diversity capital of the world--and if we don’t make it as a big-time town, it will be sad.”

Everything rests on a partnership between Disney Hall and Los Angeles County. But since estimates began to spiral upward in 1994, the once-cordial relationship has become strained.

County officials have virtually completed a 2,500-space parking structure--paid for by a $100-million bond issue--under the proposed hall at the corner of 1st Street and Grand Avenue. Although it will be open for daytime parking, the county would lose substantial revenue from concert-goers if the hall is not built.

But county officials will not give construction the green light until they receive guarantees that enough private money exists to complete it.

“What we certainly don’t want is to build half a concert hall,” said attorney Richard S. Volpert, the county’s representative on the project.

To date, Disney Hall officials have in hand only a pledge of $2 million toward the $100-million funding gap. The group must persuade the county that it can raise 95% of the remaining $98 million within a reasonable deadline. County officials have yet to determine what that deadline will be, but they expect it to be several years from now.

Lillian Disney’s gift--including interest accrued since 1987--totals $75 million, of which $41 million has been spent.

She has agreed to donate another $22.5 million if necessary, bringing the Disney family’s total gifts to $97.5 million.

Colin Shepherd, a senior vice president of Hines Interests, said that Disney Hall’s cost increases are not unusual, just better publicized than most because the county has required cost estimates at various key points in the project’s progress. “If there is a source to pay for it, how many times does that source pay for (cost increases) and nobody hears about it?” Shepherd said. Shepherd and others noted that the $102-million Sydney Opera House, which opened in 1973, suffered similar cost and construction difficulties.

Still, the dramatically escalating costs have led to finger-pointing, particularly at the complexity of architect Gehry’s design. Gehry is now openly defending his reputation for bringing projects in on budget. He says firmly that his unusual design is not to blame for the financial problems. In a recent interview, he disputed Disney Hall backers who say his design was too complex to permit accurate cost projections.

“It’s obvious that a lot of people will point a finger at us and say, ‘Oh, it’s that crazy Gehry,’ ” he said. “But the last 10 buildings we did, including (the unfinished Guggenheim Museum of Modern Art) in Bilbao, Spain, are all on budget and are equally complex.”

For the past month, Gehry has been presenting potential clients with a prepared statement blaming the failure to maintain cost control on “a project management firm and another architectural and engineering team (that) were separately contracted by the client.”

If the project is canceled, what’s left of the Disney money would revert to a charitable trust fund. The county would collect $10 million in damages and use it to top off the garage. The Philharmonic would stay in its current quarters, the Dorothy Chandler Pavilion. Costs of jettisoning the project, including contract penalties, would eat into the balance of the Disney funds.

Disney Hall supporters are scrambling to build community support. They have appointed a new full-time volunteer chief executive officer--investment executive Harry Hufford, 63, a former Music Center acting president who also has served as county chief administrator. “I guess I’ve agreed to make a run at this, to fundamentally take the ball over the goal line,” he said in an interview. “It’s a relatively high-risk role.”

Hufford will oversee Hines and launch new fund raising.

To attract and reassure donors, an accurate cost estimate will be crucial.

Further, many who give large gifts do so on the condition that their names be attached to part of the building. Disney Hall has a problem: It already is named for Walt Disney--leaving other major donors with opportunities only to have rooms, gardens and other parts named after them. If--as in the case of Disney Hall--the design is still subject to change, it is harder to make promises.

Lillian Disney’s is a family gift, not from the Walt Disney Co. In 1982, the family company, Retlaw Enterprises, sold the rights to Walt Disney’s name and likeness to the Walt Disney Co. for $47 million. That money was put aside for an unspecified charitable gift.

“I wanted to see Mother do something she could realize in her lifetime, rather than to leave a foundation to be used after she was gone,” said Diane Disney Miller. Disney is in her mid-90s; her daughter would not confirm her exact age.

In 1987, Music Center then-Chairman F. Daniel Frost, who had been Walt Disney’s tax attorney, presented Lillian Disney with Los Angeles Times articles detailing the Music Center’s desire for a new concert hall. Disney readily agreed to donate her funds.

At the time, Frost was the son-in-law of Music Center founder Dorothy Chandler and was a board member of Times Mirror, parent company of The Times. He has since divorced and has left the Times Mirror board.

Frost said in an interview that he had expected Disney’s “magnificent gift” to virtually cover the cost of the hall, with fund raising closing the gap.

He based his guess on other recently built concert halls, including the Orange County Performing Arts Center, which cost $72 million to complete in 1986.

Ernest Fleischmann, executive vice president and managing director of the Los Angeles Philharmonic, says now that he would have estimated a much higher cost:

“A hall of the type we wanted to build, something like the Roman Forum, both a concert hall and a public space where people could come and be , with a garage for say, 1,000 cars--I would have guessed $150 to $200 million for the whole project.”

Lillian Disney wanted to build “something grand” in her late husband’s name, Miller said. But her requirements were simple: In the tradition of Disney’s family entertainment empire, she wanted a hall for the masses, not the elite. She wanted “perfect acoustics.” A lover of flowers, she wanted gardens.

Miller said the Disney family never sought to control the project. “I had no conception in my mind about what it should look like,” she said. “I’m not really an architecture nut--to me, a building is beautiful if it works well.”

Miller said that her mother has “found it very difficult to understand and accept” the delays in seeing her concert hall built. The Disneys are not the only ones feeling frustrated. Esa-Pekka Salonen, the Philharmonic’s music director since 1992, said that while Disney Hall was not the main thing that lured him from his native Finland, “it was certainly an element in what made the entire package very attractive.

“One thing about working with Frank (architect Frank Gehry) is he saw the whole concert hall as an instrument, in a sense--a musical instrument . . . the collaboration was deeper and more profound than talking about acoustics.”

While nobody could foresee the financial problems, no one ever expected the hall to be inexpensive. All of the documents surrounding the project are peppered with the term “world-class.”

In 1988, Gehry was selected as the architect in a much-ballyhooed competition. Disney Hall officials, including Gehry, selected Dworsky Associates to translate his conceptual designs into working drawings. Gehry won the competition with a curving, flowing design he called “usable sculpture.”

After the competition--which specified no budget, according to Disney Hall official Frederick M. Nicholas--Gehry signed a contract that loosely set a working budget of $115 million.

“They pushed continually for state of the art,” Gehry said. “Normally we are given a strict budget and we work our butts off to meet it. In this case, it was not that.”

Gehry described the curves of his competition design for the hall’s interior as a flower for the garden-loving Lillian Disney. Gehry is known for his acoustical redesign of the Hollywood Bowl shell, as well as the new American Center in Paris, among his many projects.

The first cost increases had less to do with the building’s state-of-the-art ambitions than with a series of time-consuming redesigns, including an outside firm’s acoustical redesign after the competition, as well as two redesigns by Gehry--first to accommodate a plan for a luxury hotel on the lot, and then another when that was dropped.

Despite delays, the project seemed on track in 1992, when the Music Center board, Disney Hall officials and the county voted to break ground on the garage by Lillian Disney’s Dec. 31, 1992, deadline. At that time, cost of the hall was still estimated at an affordable $110 million.

But at that point, the delays and Lillian Disney’s deadline forced the parties involved to take a calculated risk that backfired in 1994.

In order to meet her deadline, hall officials had to rush to come up with a cost estimate based on schematic, or conceptual, drawings. It was a riskier venture than anyone realized.

In a process known as fast-tracking, in which work on a project begins before a maximum building cost is established, the Disney Hall team and the county agreed to break ground in the hope that the risks of starting early would offset the costs incurred by delaying further.

Although Disney Hall officials and the Music Center board sought contracting estimates to minimize the risk, some board members warned that significant increases might crop up.

Longtime Music Center board member Stuart Ketchum, a prominent real estate developer, and Music Center Chairman Egelston confirmed that some Music Center board members were against fast-tracking the project.

Ketchum said the skeptics included himself; James A. Thomas, a managing partner of Maguire Thomas Partners developers and acting Music Center chairman at the time, and Ronald J. Arnault, executive vice president and chief executive officer of Arco. Thomas would not comment on Ketchum’s claim, and Arnault said only, “I know that my feeling was it could be done.”

Despite doubts, the Music Center board voted to proceed--as did the county, also aware of the risks. The county said groundbreaking on the garage could not begin until 85% of the cost of the building was available in cash, pledges or other provable sources of income.

But with an estimate of $110 million, the requirement was easily met: $93.6 million from the Disney family, a $1-million gift from Toyota Motor Sales for an organ and a “best efforts commitment” for the Music Center to raise $17.5 million. Total: $112 million. Disney and the Music Center also each pledged another $17.5 million if needed.

The $110-million figure for the hall held firm through a periodic estimating process until the spring of 1994, when more complete working drawings became available and were taken to subcontractors for bids. Those bids came in significantly higher than expected. When added to already escalating design costs, by the summer of 1994, cost estimates reached $160 million.

“That was what caused the Paul Revere alarm to go off, that the project needed more management, more control,” Ketchum said. “I remember because I was on the phone for 2 1/2 hours in a bathing suit in Hawaii.”

Disney Hall officials have said many factors led to the unexpectedly high bids: inflation, escalation of materials’ costs, a subcontractors’ market affected by the Jan. 17, 1994, earthquake and the recession, as well as the complexity of Gehry’s design.

Hall officials confirm that Gehry’s work was on budget but continue to maintain that complexity was a factor.

However, one source close to the project raised questions about the adequacy of the working drawings by Dworsky Associates.

Nicholas denies that there was any problem with the Dworsky drawings not attributable to fast-tracking. The subcontractors “were working with drawings they did not understand,” he said. “They were not ‘bad’ drawings. It was a question of the subs not understanding them.”

Daniel Dworsky, principal of Dworsky Associates, said the complexity of the design was a factor in the high bids. “If you want to give a price on these drawings, you have to study them very carefully. This is a one-of-a-kind building. You just don’t simply open up the plans and understand them quickly.”

Meanwhile, as the new project managers continue to chase a reliable cost estimate, that figure remains a moving target as predicted costs continue to rise because of what Gehry partner James Glymph calls the “cost of stopping”--as current contracts are dissolved and penalty fees accrue during the waiting period.

Music Center Chairman Egelston said there’s no point in dwelling on who, if anyone, is to blame. He says the important thing is to move ahead.

“We see failure on this project as unacceptable,” he said. “There is nothing wrong with this thing except, like anything that is big and complex, it’s a struggle. The project will be under control, we’ll know the costs and we will go to work and get the money. And when the baton goes down on that wonderful night, it’ll just knock your socks off.”

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A Troubled History

1987: Lillian B. Disney on May 12 offers $50 million to build the Walt Disney Concert Hall on county land across the street from the Downtown Music Center. Groundbreaking must begin by the end of 1992. Six months later, a group of 15 officials and advisers visit seven world-famous European concert halls and later another group travels to Japan to examine five others.

1988: From a field of 72 competitors, Los Angeles architect Frank O. Gehry is selected to design a 2,500-seat concert hall scheduled to cost $115 million. Groundbreaking is expected to begin in 1990 with completion in the fall of 1993.

1989: Dworsky Associates is hired as executive architect. Gehry begins a series of redesigns to improve the hall’s acoustics and to add a luxury hotel, which is later dropped. The new plans prompt project managers to set aside the hall’s original budget limitation of $115 million.

1991: The Disney Hall Committee of civic and cultural leaders overseeing the new complex announces its final design, with a projected price tag of $110 million. The County Board of Supervisors insists that building not begin until 85% of the money to build the hall is identified.

1992: A “symbolic” ground-breaking ceremony for the hall’s underground parking garage is held at the end of the year to meet Lillian Disney’s deadline, even though working drawings for the concert hall are not done and there is no guaranteed maximum cost. Construction is expected to begin in January, 1995, with the opening performance set for the fall of 1997.

1994: A new cost estimate from subcontractors adds $50 million to the price tag, for a total of $160 million. Construction is halted and a new construction manager, Hines Interests of Houston, is asked to undertake a cost review. County supervisors threaten to declare the project in default.

1995: The project’s estimated cost soars to $200 million. The underground garage, financed with county bonds, is incomplete. Civic leaders scramble to save the project and close a $100-million funding gap by bringing in new personnel. County supervisors await the findings of the Hines report.