Library, foundation continue to bicker

Noaki Schwartz

NEWPORT BEACH -- Nearly six months after a bitter feud between the

library foundation and board of trustees erupted publicly, the problems

have yet to be completely solved.

While most of the major disagreements over mismanagement have been

addressed, there are still lingering issues over which body gets to claim

the high-profile Distinguished Lecture Series as its own. Traditionally

considered a trustee event, the foundation has footed a good portion of

the bill.

Still, Mayor John Noyes, who has been refereeing meetings between the two

groups, and others say they’re coming close to drafting a final agreement

outlining their respective roles.

Trustee chairman Jim Wood said the board is ready to make peace, but is

still waiting to hear from the 20-member foundation board. Foundation

chairman David Carmichael would not comment on precisely what is going on

within the foundation, but did say it has “agreed in principle with the

memorandum” and is “waiting for the fine-tuning.”

“It’s a situation where you’ve got two groups which are working out the

final details of their agreement,” Carmichael said, adding that in the

end, the dispute was “no big issue” and simply a case of

miscommunication.

However, the allegations of financial mismanagement were serious enough

for library trustees to threaten to sever ties with their main

fund-raising body.

The library, perhaps the city’s greatest monument to a collective

community effort, had unwittingly become a boxing ring showcasing an

increasingly heated match. The fight -- pitting former city politicians

and other high-profile residents -- became so embarrassing that the City

Council was finally forced to step in at the end of January to pull the

two entities apart.

The dispute over control of the foundation’s savings had been festering

for more than a year before it surfaced publicly last fall.

While the foundation attempted to build an endowment fund to help the

library during bad financial times, the trustees rejected the idea and

wanted the $1.5 million for more immediate uses. Among other things, the

trustees also demanded clearer financial reporting and a reduction in the

foundation’s operating costs.

The relationship between the two is symbiotic. While the foundation

raises money for the library, the board decides how the dollars are

spent.

The lingering tug of war over the Distinguished Speaker Series ties in

directly with the disputed operating costs. Trustees claim the costs were

anywhere from 50% to 70% of the money the foundation raised. A large

chunk of what the trustees considered operating costs, however, was the

award-winning series, which has featured such noted speakers as social

activist Susan Faludi and TV journalist Tom Brokaw.

Still, relations appear to be better than they were two months ago, when

frustrations escalated to such a level that the trustees sent a letter to

the foundation demanding that unless foundation members signed a

cooperating agreement, they would have to move out of the library office

and turn over the endowment fund. It was this event that caused

Councilwoman Norma Glover to ask the city attorney to intervene.

In the end, after studying the situation, City Attorney Bob Burnham

temporarily capped the dispute when he pointed out that the trustees

could not control the foundation and did not have exclusive rights to the

library’s name.

The foundation must remain legally independent of the trustees in order

to operate as a private, nonprofit organization, Burnham said. Therefore,

the trustees could not gain the financial control they sought.

Moreover, the foundation had already seen to it that, if disbanded, the

money would go to the Orange County Community Foundation and still end up

as an endowment fund for the library.

After a cooling-off period, both parties have been back at the

negotiating table, hoping to salvage everything they’ve worked so hard to

build.

In seeing a renewed spirit of cooperation at the meetings, Noyes has said

he is optimistic the problems can be ironed out. Still, until the

agreement is signed and the ink has dried, talks could fall apart as they

have in the past.

However, once all has been resolved, Wood says he hopes they can throw a

big party at the library to celebrate.