Latino Museum Scrambles for More Funding

The Latino Museum of History, Art and Culture, which has been closed since August because of severe financial problems, is at a crucial crossroads that may determine whether its doors ever open again.

The 2-year-old operation is now nearly $500,000 in debt, according to one board member, and has no new funding or revenue sources in the offing. Its entire staff has either resigned or been laid off, including museum director Denise Lugo. A planned November exhibition of works by Mexican artist Francisco Toledo was canceled, and the museum has been closed to the public since its “An American Leader--Cesar E. Chavez” exhibition ended in August.

The board of directors, however, is not ready to pull the plug. Board member Anna Maria Araujo, KNBC-TV’s community relations liaison, and Juan Gomez-Quinones, a UCLA history professor, said the volunteer group has been meeting weekly for the last month, trying to put their financial history in order and hoping to save the institution by finding major donors to pump money into the museum’s coffers. The board is also recruiting new members to fill four vacancies due to attrition or resignations. Also, the terms of its chairman, Charles Calderon, and Gomez-Quinones have technically expired.

“We are not dead in the water,” said Araujo, who joined the board in 1998, in a phone interview.

“I am hopeful that with some effort and luck we can turn these things around,” said Gomez-Quinones, in a separate interview.

Neither Calderon, a former state senator and longtime advocate for the museum, nor Lugo, returned calls related to this story.

Araujo and Gomez-Quinones would not comment on who is being approached to help bail out the museum. Both admit it may be difficult to find wealthy donors willing to commit to a museum that has no staff and a history of financial problems.

Gomez-Quinones and Araujo said the board hopes to avoid bleaker options, including selling the museum building, borrowing against it or declaring bankruptcy. The building, located at Main and 1st streets in downtown Los Angeles, was donated without contingencies to the museum in exchange for $1 by Bank of America in July 1999. It is worth approximately $1.7 million, according to county records.

“[Selling the building may be] the only way that is immediately available to us. . . . [However] you are not going to be able to leverage as much as you could under pressure to sell and rush to do it,” said Gomez-Quinones, who is against a sale.

He continued: “I want to keep the property and the facility free and clear. But [borrowing] is another option, and circumstances may go in that direction.”

Richard Schnell, senior vice president of Colliers Seeley, a commercial real estate brokerage firm active in downtown L.A., said obtaining a loan against the building is unlikely because the museum apparently has no sources of funding or income.

In August, when the museum’s debts first came to light, board president Calderon said the institution was relying on the California Legislature to change the terms of $1.6 million in allocations made to the museum in the 1999 and 2000 state budgets. By law, that money could only be used for educational programs and capital expenditures, but legislation sponsored by Assemblyman Martin Gallegos (D-Baldwin Park) would have freed up the funds for debt relief and general operating expenses.

Gov. Gray Davis vetoed the legislation in late September, saying reallocating the money would set an “unacceptable precedent.” The $1.6 million remains available to the Latino Museum but only on its original terms, said Adam Gottlieb, spokesman for the California Arts Council, which administers state arts funding.

Employee Salaries Withheld Since April

The museum, which charged no admission and had no full-time fund-raiser, had been underfunded since formally opening its doors in 1998, according to Gomez-Quinones. The critical financial slide, however, began in February.

“It was always with hope and a shoestring, but we were staying in the black. In the last eight months the thing began to just go off,” Gomez-Quinones said.

According to documents obtained by The Times and interviews with former employees, the museum began to withhold salaries in April.

To date, 15 claims for back pay have been filed with the California labor commissioner. Spokesman Dean Fryer says the labor commissioner is hoping to work with the museum’s board to find money for the employees. Fryer said the museum owes $75,000 to $100,000 to its former employees.

“We will work with the museum to make sure we can get whatever the employees are due,” he said. “We would rather do it in that manner than having [the museum] file for bankruptcy.”

In addition to back salaries owed to employees, at least half a dozen Los Angeles businesses are owed hundreds of thousands of dollars, according to interviews with creditors. Among those owed are Photo Impact, which developed prints for the photographs in the museum’s Cesar Chavez exhibit; Good Gracious catering company, which was hired for the Chavez exhibition reception; the Jerry Solomon storage, which is owed seven months of rent; Glendale Blueprint Co., which printed most of the museum’s fliers and invitations; and the Los Angeles Times, which was not paid for an exhibition advertisement.

Several artists, including Francisco Toledo, one of Mexico’s foremost painters, are also owed money.

Toledo’s gallery in Oaxaca, Mexico, which was organizing a show of graphics for the museum set to open in November, is owed nearly $2,000 for framing 90 works intended for the exhibition, said gallery owner Claudina Lopez Morales. Lopez Morales said she has sent Lugo several e-mails and invoices but has never received a response. She said she was informed of the show’s cancellation via fax in early September.

Sculptor Roberto Delgado, who created the bas-relief facade of the museum building, said he is still owed $2,000 of his $5,000 fee.

When the museum officially opened its doors in August 1998, it was still considered something of a work in progress. It had required an 11-year campaign to get the institution off the ground, and at that time, Calderon set a future fund-raising goal of $13 million. However, the museum never hired a full-time fund-raiser and in an internal memo a volunteer fund-raiser stated that the museum’s failure to provide coherent financial information was dooming efforts to raise money. Former museum director Lugo has denied knowledge of the memo and said that potential donors had received the information they requested. Lugo, who worked briefly as a professor of art at Cal State L.A., but had no previous museum experience, was first named interim director at the museum in 1996, then promoted to director in 1998.

Since the opening, the museum has mounted at least seven exhibitions. According to the museum, its two most successful shows were a 1999 exhibition of Mexican poster art and the Chavez show earlier this year--each drew crowds of 5,000 at their openings. However, an exhibition on a group of Chicano artists known as Los Four--a major initiative--was repeatedly rescheduled and ultimately canceled for lack of funding.

“I am very sorry that things have turned out the way they have,” said Gomez-Quinones of the museum’s escalating problems since August. “It is astounding what has happened.”