Noaki Schwartz
NEWPORT BEACH -- Six weeks after library trustees threatened to fire
their fund-raising arm, leaders on both sides are saying detente is
almost at hand.
In October, the library Board of Trustees sent a forceful letter
threatening to sever its relationship with the Library Foundation because
of differences over finances and control, even threatening to banish the
nonprofit group from library premises.
Since then, the two parties have held marathon meetings to come to some
sort of resolution. And they have made a significant amount of progress,
said City Manager Homer Bludau, who has been mediating the weekly
summits.
"Right now, drafts of an agreement are being worked on," said David
Carmichael, foundation president. "It's a series of guideposts on how
we're really going to enhance communications to avoid problems like this
in the future."
Despite the pending peace agreement, the spat -- which has pitted two of
Newport's most respected organizations against each other -- has rocked
the usually tranquil library establishment.
The Oct. 19 letter demanded the foundation reduce its operating costs,
regularly give clear financial reports to the trustees and give greater
control of the foundation operations to the city and library board.
If the foundation did not comply with the trustees' requests, the board
threatened to dissolve its relationship with the foundation. That would
require the foundation to cease fund raising in the name of the library
and "begin the process of vacating the library premises."
For almost six weeks, both groups have remained tight-lipped about the
details of the disagreement, only saying that nothing illegal has
transpired. An audit conducted on the foundation in September found the
foundation's finances to be in order.
One of the major issues appears to be whether the foundation should build
up its endowment fund or use donations to meet more immediate needs at
the library. Since its inception five years ago, the foundation has given
about $574,000 directly to the library and has established an endowment
fund of nearly $1 million.
In the foundation's current budget, most of the money raised for the
high-profile Campaign 2000 effort has been marked to build up the
endowment fund. Of the $1.6 million expected in donations this year,
about $1.3 million would go to the endowment fund, $83,500 to the library
and the rest to operate the foundation.
Another issue for trustees is what they call an increasing percentage of
