Santa Ana Officials Indicate Support for Bowers’ Plea for Funds

Santa Ana’s city manager said Wednesday he favors granting a five-year freeze on funding cutbacks to the Bowers Museum of Cultural Art after its director argued the museum needs more money to build “a world-class reputation.”

While he didn’t go as far as City Manager David N. Ream, Mayor Miguel A. Pulido Jr. said he was “very supportive” of the museum and would revisit the issue depending on the city’s budget.

The officials’ comments came after The Times on Wednesday disclosed the contents of a letter by Peter C. Keller, the museum’s executive director, in which Keller said the museum faces “serious financial difficulties” and could suffer dramatic cutbacks in operations and staffing if Santa Ana continues to reduce its subsidies 10% a year.

Keller made the statement in a draft letter to Ream that was distributed to the museum’s Board of Governors but never sent to the city manager. A second letter, faxed to Ream this month, made the request for city funds with none of the details of the museum’s financial woes.

In the draft, Keller warned that without the city money the museum’s staff would have to be cut “substantially,” departments eliminated and other areas dramatically reduced. Kidseum, the children’s museum, would be closed, and exhibits of national importance would all but end.

The letter said the financial problems began last year when the city subsidy was cut for the first time and a five-year capital fund-raising campaign ended. Between the two cutbacks, the museum has lost $510,000 a year.

Despite the financial difficulties, Ream said he is supportive of the museum. “They’ve far exceeded our expectations from the time we made that contract,” he said. “We’ve definitely gotten our money’s worth.”

Keller, whose contract expires next month, said Wednesday the agreement between Santa Ana and the Bowers was based on running a much smaller operation. “Once we got this new museum up and running, we found out that wasn’t the type of museum we wanted to be associated with,” he said.

Since a major expansion in 1992, the museum has grown substantially and has had an annual budget of $3.5 million to $4.5 million.

The city and the Bowers signed an agreement in 1987 to gradually reduce city funding, and a board was organized to run the museum. The funding cutback started last year. Since the agreement was signed, the city has given Bowers $14 million in operating subsidies and spent another $12 million for the expansion.

“I frankly would have hoped that we would be prepared for” the loss of city funding, Keller said, adding that raising enough private money to run the museum is “no small task” even with the subsidy.

The details of financial distress contained in the draft letter are at odds with recent comments from Keller and other museum officials.

Donald P. Kennedy, chairman of First American Financial Corp. and a member of the Board of Governors, said Wednesday the museum is not experiencing money problems, and he called it “financially well run.”

Keller told The Times in December that after the exhibit of the royal tombs of Ur, “we are in probably the greatest cash flow position in our lives.”

Less than two weeks ago, James Stathekis, who oversees the museum’s finances, said a substantial boost in the admission price was not caused by financial necessity.

Pulido said museum officials approached him a year ago about modifying the funding agreement and renewed discussions about four months ago.

“I’m satisfied they’re doing a very good job,” Pulido said.

Other Santa Ana council members appeared to have mixed feelings about the museum’s request.

Councilman Thomas E. Lutz said he would support a freeze in the city subsidy reduction for a year but “would want to ask some questions” before recommending a five-year freeze.

For instance, Lutz said, the Bowers is asking for more money two years after making a strong case for privatization, asking the city to sign over its deed to the museum building and to turn over the 40% portion of the art collection it owns.

“I don’t know how you explain that,” Lutz said.

Councilwoman Lisa Bist said the city has spent a great deal on the Bowers. “We’ve invested a lot in there with the expansion,” she said. “As an investment and our asset, we have to take the request seriously.”

Councilman Ted R. Moreno said Tuesday he would have expected the museum to abide by its contract. “It looks like they’re trying to renege.”

Since November, the museum has been without a development director, whose job it is to head fund-raising efforts; since the mid-1990s, no one has held the job for more than 1 1/2 years.

Some board members are grumbling about Keller’s ability to raise private funds for the museum.

“The bottom line is the bottom line. Show and tell. What’s his record? Has he raised money?” asked one board member. “Not substantial amounts of money, no.”

Times staff writer Zan Dubin contributed to this report.