USC Price School of Public Policy

MPA Paper


The Children’s Museum of Los Angeles:
A Case of Relocation

COLLEEN DILENSCHNEIDER | CAITLIN ISHIGOOKA | ZOE MELCZER | JESSIE NEMIROFF
Master of Public Administration Candidates, 2011
University of Southern California
Price School of Public Policy

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The Children’s Museum of Los Angeles (CMLA or the Museum) opened to the public in 1979, with the mission to educate, entertain and enrich children’s lives in the greater Los Angeles area. Dedicated to providing families and schools of Southern California with hands-on exhibits and programs, the Museum’s play-centered environment is treasured by generations of schoolchildren and adults alike. By 1999, the Museum has experienced tremendous growth in terms of programs and exhibits and its 20 year-old home is starting to show its age. At the height of this success, the Museum is in need of dynamic leadership, now more than ever, to guide it through its next phase.

This case follows the CMLA Board of Trustees’ struggle to decide the future of the Museum. Leadership must choose between staying in the Museum’s current tried and true downtown Los Angeles space, or pursuing an opportunity to move to a larger, brand-new building in the eastern San Fernando Valley, 22 miles outside of the city’s center. Board President Bruce Corwin must support the group as it weighs the costs and benefits of each option to arrive at a decision that best reaches and enhances the lives of the greatest number of Los Angeles area children.

Key case objectives include:

  • Evaluating how the leadership of a nonprofit works together in making major organizational decisions;
  • Exploring nonprofit partnerships with the public sector; and
  • Assessing the importance of geographic location in a nonprofit organization’s ability to serve its clientele.

It is a spring afternoon in 1999. Bruce Corwin sits in his office in west Los Angeles at the headquarters of Metropolitan Theatres. Memorabilia-lined shelves and photograph-adorned walls surround him, painting the picture of a beloved family man, sports fan, entrepreneur and public servant, a respected friend and colleague of many. This particular afternoon, Corwin is preparing for an important board meeting at the Children’s Museum of Los Angeles. Of the dozen charitable boards on which he serves, CMLA is an organization he holds particularly dear to his heart. Twenty years prior, the initial idea for the Museum was spawned in his own living room by his son’s kindergarten teacher. Under his leadership as Founding President, and now active trustee, the organization grew from a PTA project into a $1.3 million a year operation. The Museum is now a popular destination located in the center of downtown Los Angeles, serving nearly 250,000 visitors each year. Dedicated to providing families and schools of Southern California with hands-on exhibits and programs, the Museum’s play-centered environment is treasured by generations of schoolchildren and adults alike, who have all grown up with the Museum in their backyard.

Earlier that week, Corwin had joined CMLA CEO Sally Thompson at a lunch meeting with newly-elected Los Angeles City Councilman Alex Padilla, a young, charismatic politician who serves a district in the eastern San Fernando Valley. Many Board members are eager to vote Padilla into the cadre of CMLA leadership. In addition to the importance of having a CMLA advocate within the local government, they emphasized how Padilla’s presence on the Board could help the Museum expand its donor and visitor base beyond its traditional scope. This set the stage for their meeting; however, the most pressing issue of the lunch hour had been a discussion of the Museum’s future and the possibility of relocating. CMLA’s downtown home is far from perfect: the ramp leading to the main entrance is perpetually lined with homeless people, parking is inconvenient, and the 17,000 square-foot building stifles the potential for new, innovative exhibits. Padilla, aware of the Museum’s growing pains, had made an interesting proposition: build a new museum in the Hansen Dam Recreational Area—1,400 beautiful acres of land located in the northeast San Fernando Valley. Now that Padilla is a councilmember, and in line to join the Board of CMLA, the city planning process is sure to be a breeze.

This proposal presents an enormous growth opportunity for the Museum. With Padilla’s help, CMLA is poised to finally bring Los Angeles a world-renowned facility, on par with the museums that had first inspired them to open. Yet appealing as this offer may be, the organization’s finances cannot withstand both operating at its current capacity and undertaking a multi-million dollar capital campaign. It would be forced to temporarily shut down to focus all efforts on construction. Many questions remain unanswered about how a new location, 22 miles outside of the city’s center, might affect the organization’s current stakeholders, many of whom have dedicated nearly 20 years of service to CMLA and are hesitant to abandon all they have accomplished. As he prepares to head to the meeting, Corwin continues to deliberate: is it a good idea to close the doors of the Museum at the height of its success? He’s not sure.

A Teacher With an Idea

Corwin was immediately captivated by the concept of a children’s museum in Southern California from the moment that his son’s kindergarten teacher, Jackie Dubey, explained the importance of such an institution. Dubey came up with the idea in 1977 after conversations with fellow teacher Ellen Levitt at the Center for Early Education, an exclusive private school in West Hollywood. Dubey presented the plan to a classroom full of her kindergartners’ parents, many of whom, including Corwin himself, had never before heard of a children’s museum. The proposed Children’s Museum of Los Angeles, Dubey explained, would be much like the popular children’s museums that had opened in Brooklyn and Indianapolis, and would foster a “please touch” environment in which children could learn and grow through play and hands-on activities. After learning more about the interactive nature of these kinds of museums, Corwin was convinced of the significant role that children’s museums serve in community growth and child development.

Inspired to bring this exceptional learning opportunity to the children of Los Angeles, Corwin took on the task of founding CMLA. He summoned support from fellow parents and grandparents of children enrolled at the Center for Early Education, and tirelessly pursued both business and community connections. When Corwin began searching for possible locations, his friend, Los Angeles City Councilmember Gilbert Lindsay, put forward an offer Corwin could not refuse: a rent of one dollar each year to utilize a former restaurant space inside the Civic Center of Los Angeles. Twenty years later, the Museum still sits proudly in its original downtown location. Corwin continued his commitment to the project after it opened, as he and actress Anne Bancroft (also an involved parent at the Center for Early Education), served as the Museum’s first two Board officers.

Even from its conception, the Museum dared to be different. Hands-on exhibits broke the museum norm, as staff members worked with renowned architect Frank Gehry—known for his daring, innovative design solutions—on developing a space that would stand out. Within its walls, the Museum aimed to be a “hodgepodge, a maze, an amazement of plywood and photomurals,” according to a Los Angeles Times article written just before the Museum’s opening.1 Exhibit designers worked hard to ensure that the Museum would provide an educational and cultural experience based on visitor interaction. Another article noted that “the building seems almost alive.”2

CMLA opened to the public on June 11, 1979, with the mission to educate, entertain and enrich children’s lives in the greater Los Angeles area. The Museum still prides itself on providing an interactive space for children to explore, experiment and learn, boasting 20 hands-on exhibits that make learning engaging for children between two and 12 years of age. Corwin’s personal favorites include the City Streets exhibit, where children role-play as bus drivers or city officials, and the Sticky City, in which children build structures and tunnels using Velcro cushions. (See Appendix 1.)

By 1999, the Museum has experienced tremendous growth in terms of programs and exhibits. The 40,000 visitors welcomed in 1979 has multiplied to nearly 250,000 visitors and is growing each year, 16 percent of whom attend free of charge. The Museum boasts a strong relationship with the Los Angeles Unified School District (LAUSD), regularly hosting schoolchildren from throughout the region, many from Title I-designated low-income schools. After decades of play and thousands of visitors, many of the exhibits built in the 1980s are starting to show their age. Corwin knows it is a matter of time before the Museum and its programs outgrow the Civic Center of Los Angeles space—if it has not happened already.

1 Dreyfuss 1979, G1.
2 Worthington and Paull 1987, 30.

Leadership

The CMLA Board of Trustees had expanded from its two original officers to a prestigious group of 25 in 1999. The Museum has maintained its wealthy founding demographic of parents from the Center for Early Education, attracting well-connected civic leaders and educators from throughout Los Angeles, including philanthropists, film producers, attorneys, accountants and early childhood development experts. Board members reside primarily on the west side of Los Angeles in areas such as Beverly Hills, Bel Air and Brentwood, although a few members hail from the San Fernando Valley. The majority of the trustees have served the Museum for many years, some dating back to its founding. The Executive Committee has recently begun exploring ways to diversify the Board’s make-up, feeling the Museum’s programs and donor base might benefit from the input of fresh members. (See Appendix 2.)

The Board is particularly proud of its decision to expand the Museum’s administration, just hiring President/Chief Executive Officer, Sally Thompson, to work with current Director/Chief Operating Officer, Candace Barrett. They are hopeful that Thompson’s background in arts philanthropy and fundraising at the MusiCares Foundation will complement Barrett’s experience in running CMLA’s day-to-day programmatic activities, including oversight of 20 staff members.

Finances

CMLA brought in $1,353,875 in earned and donated revenue during the 1998 fiscal year, 40 percent of which yielded from program services (mainly admission sales) and 54 percent from private contributions. The Museum’s roots within the wealthy Los Angeles community continue to serve as a powerful asset in attracting the support of well-connected Board members and donors such as Doug Ring, the current Chairman of the Board. Ring has a long history of donating large sums to the Museum, and regularly steps up to fund new projects. In fact, in this year alone, Ring has already granted CMLA $68,000 for program growth beyond his annual Board dues contribution. In 1998, the Museum secured a total of $727,719 in grants and contributions, with a majority of the support coming from individual Board members. The organization does not have a traditional development department, and Board member connections carry much of the fundraising responsibility. In addition to this revenue, 3 percent came in from sales at the Museum’s store, 2 percent from special events, and 1 percent from investments.

Though total revenue surpassed $1 million in 1998, expenditures amounted to $1,359,485, leaving the Museum with a relatively small deficit that year ($5,610). Seventy-two percent of expenditures were dedicated to program services, 20 percent to administration, and 8 percent to miscellaneous expenses, such as building repairs. Despite the slight deficit, CMLA is financially stable in 1999, with $192,897 in net assets reported at the end of the year in the organization’s 990 form for 1998. The Museum carries no debt and has a liquidity ratio of 2.68. (See Appendix 3.)

Downtown Location: A Push to Move On

The Museum, at 310 North Main Street in downtown Los Angeles, is centrally located, in close proximity to government buildings and other cultural institutions, and near public transportation and freeway connections. The area is conveniently accessible to students and families traveling from any point in the entire Los Angeles County region. (See Appendix 4.) Despite its geographic advantages, Corwin and his fellow trustees are growing concerned about the Museum’s neighbors: Skid Row and the persistent presence of homeless people on the streets surrounding the facility. Though there have been no reported incidents of harm or harassment of Museum visitors, members have voiced concern that such an altercation may occur in the near future, and want to proactively avoid any notoriety this would bring. Others would like to minimize the discomfort that occurs when grandparents, walking hand-in-hand with their grandchildren, must swerve around and nearly step over homeless individuals as they approach the Museum.

In addition to the unwelcoming environment surrounding the Museum, parking at CMLA presents its visitors with another challenge. In an automobile-heavy city such as Los Angeles, plentiful and convenient parking is a necessity to the success of any cultural destination. Unfortunately, the Museum’s parking lot, part of the Los Angeles Mall complex that houses CMLA, is inadequate for the Museum’s needs. Visitors who choose to park there, rather than paying a large fee to park in a downtown parking lot, are forced to walk through a maze-like path for several minutes to find the Museum entrance. Furthermore, the congested downtown corridor is not conducive to parking school buses for long periods of time, which presents an ongoing logistical challenge to Museum staff.

These external factors are only a portion of the motivation fueling many of the Museum’s Board members to advocate moving out of the downtown space. Many of its exhibits, though still adored by the Museum’s youthful audience, need renovations or are no longer relevant in the new millennium. Furthermore, CMLA’s target audience, LAUSD, serves over 500,000 students. With only 17,000 square feet of space, CMLA is unable to serve all of LAUSD and expand its reach at the same time.

One veteran Board member adamantly supports a Museum expansion and has vocalized his concerns at recent meetings, noting that as a long-serving Board member he has seen the Museum grow exponentially but knows it can reach greater heights. He has expressed that CMLA should be at the forefront of educational and cultural institutions for children, and reflect the city’s creative leadership and world-class status. He believes that only by expanding the Museum to a new facility will CMLA have the capacity to become the world’s leading museum in educating, entertaining and inspiring children.

Downtown Location: Too Good to Give Up

Another Board member strongly believes that it is best for CMLA to remain in the downtown space rather than expand to a new location. She does not understand why the Board would risk closing the Museum for several years when it is currently doing so well. She contends that people love the Museum the way it is, despite its challenges. As the saying goes, there is no need to tear down the whole house if just the roof is leaking. CMLA is at the height of its success, having just received thousands of dollars in funding from the Wells Fargo Foundation, the Times Mirror Foundation, the Ralph M. Parsons Foundation and the South Coast Air Quality District for the Museum’s Reader’s Theatre Project, a program developed to improve inner city schoolchildren’s literacy through storytelling. For two years in a row, the CMLA Recycle Program has received the prestigious Parents’ Choice Award from the Parents’ Choice Foundation, which honors superior quality learning materials for children. Moreover, the Museum has built a reputation in the Civic Center location, overcoming the perceived danger of the area. Last April, the Museum launched its Hassle Free Zone program, which provides parents with itineraries for family-friendly days of fun in downtown Los Angeles. The project gained significant press for the Museum, and reinforced CMLA’s partnerships with neighboring businesses and the Los Angeles Area Chamber of Commerce.

This Board member’s experience in real estate leads her to urge the Board to question the feasibility of the Museum’s relocation to a new facility. She believes that the Board’s push to reinvent CMLA as a state-of-the-art, world-renowned Museum overshadows the reality of the situation: constructing a new facility from scratch is extremely expensive, often many more times the estimated cost. She witnessed how the construction of the Walt Disney Concert Hall exceeded its original budget and knows of the difficulties its development team faces to find sources to fill the funding gap. Above all, as a committed Board member, she truly believes that the good still outweighs the bad in the current Museum location. She would hate to see the Museum incur a large amount of debt from construction costs when the institution is currently financially stable.

Relocation: A Long Time Coming?

Relocation is not a new discussion for the CMLA Board. Trustees have been aware of the challenges of the downtown space since the Museum’s beginning. Fifteen years ago, the Board adopted a long range plan that called for the expansion of the Museum and relocation to a larger facility. It completed a relocation feasibility study in 1987, funded by the Los Angeles Community Redevelopment Agency, which resulted in the consideration of numerous new locations. CMLA had considered a spot in Griffith Park, which would have been ideal with its proximity to various freeways and other cultural institutions in the immediate area, including the Autry National Center and the Los Angeles Zoo. Although the Board had high hopes for this spot, it unfortunately did not work out because of opposition from the Los Angeles Equestrian Center, whose riding path would be hindered by the new museum. The Board was later offered a space in Little Tokyo, not very far from the current downtown location. The Board was optimistic about this spot, as its proximity to the current space would hopefully lead to a smooth transition. The Little Tokyo location, however, also met its demise once Rick Caruso, president of the Los Angeles Police Commission and friend to various trustees, advised the Board that the neighborhood was unsafe, and that they would continue to battle the same challenges existing in the current location.

A New Opportunity

Alex Padilla, at 26, has just been elected to the Los Angeles City Council. An acquaintance of many trustees, he has heard of the Museum’s desire to relocate and has expressed interest in joining the CMLA Board, conveying that there is much he can offer. Should they move forward with a relocation of the Museum, he will help in securing local, state and federal dollars, including the possibility of $17.5 million from the Los Angeles City Council in park bond fees. He also promises to help the Museum expedite the usually tedious and lengthy city permitting process. However, there is one stipulation: having grown up in Pacoima and now representing the northeast San Fernando Valley, his offer only stands if the Museum relocates to the Hansen Dam Recreational Area—a property within his district.

Located just south of the Angeles National Forest, Board members see great potential in Hansen Dam as a new location for the Museum. It offers the needed space for expansion, a clean environment where children can interact with the surrounding nature, ample parking and the opportunity to build from the ground up. Free of the downtown location’s structural limitations, this location presents the opportunity for CMLA to build a state-of-the-art facility exactly to its specifications and to the needs of its audience. In fact, the audience is foremost in the thoughts of the Board, as this presents a chance to expand its demographic reach and touch the lives of a new population of underserved children. Furthermore, public transportation developments to and from the area are underway, set to be completed by the time the Museum would be scheduled to open. The new location also offers the potential to expand the Museum’s donor base to include the film and television studios in nearby Burbank and Universal City, through the networks of several Board members who already work in the industry.

During recent meetings, both Padilla and members of the Board have expressed additional justification for choosing this location. Beginning in the 1970s, the San Fernando Valley attempted to secede from the rest of Los Angeles, complaining that it did not receive its fair share of city services. This secession fervor is again gaining momentum in the wake of the passage of a 1997 bill that makes secession easier by eliminating the possibility of a city council veto. If Padilla succeeds in bringing a museum to his district, he will not only fulfill his campaign promise of area development and redevelopment, but will also make steps toward pacifying secession forces by bringing a sense of civic identity to the San Fernando Valley. Padilla’s sentiment is shared by several Board members who also see the opportunity to bring a cultural and educational facility to an area lacking such resources. Should CMLA choose to relocate within metropolitan Los Angeles, it would be reaching the same population and still be in competition with other museums and cultural destinations, including the California Science Center and the Natural History Museum. By moving to Hansen Dam, the proposed state-of-the-art facility could be the only one of its kind in Los Angeles, serve a greater number of children, and more importantly, inspire the children of the east valley who have never before had such unique learning opportunities so close to home.

Lake View Terrace or Pacoima?

While many Board members strongly support Padilla’s hopes for a San Fernando Valley location, other members are skeptical. They fear that this proposed location is too far for central and south Los Angeles schools and for west-side families to travel—and that consequently, the Museum would be replacing its current audience as opposed to expanding it. Others express a general unfamiliarity with “The Valley” and question whether the stigma associated with Pacoima, where Hansen Dam is located, will divert attention from the first-rate facility, even though Padilla is working with local real estate agents to re-brand the area as “Lake View Terrace.” Board members opposing the relocation also believe that their lack of support for the new location will be mimicked by the Museum’s existing donors, who will be unwilling to venture to or to support the new location. (See Appendix 5.)

The Board anticipates that the proposed Museum expansion will result in increased operating costs, a need for a larger budget, and an increase in staff, all of which rely on the Board’s ability to increase and maintain funding. The heavy reliance on Padilla to lead this public-private partnership also makes some Board members uneasy. Though Padilla has guaranteed that the city, his campaign donors, and his constituents will match his support for CMLA, everyone recognizes that he is a rising star with ambitions beyond the Los Angeles City Council. As the second youngest person to be elected to public office in Los Angeles, several Board members outwardly question whether Padilla will be able to sustain the momentum, the political support he promises, or the funding in the wake of career opportunities and promotions.

Museum at a Crossroads

As Corwin approaches the Museum’s entrance on his way to the Board meeting, he is filled with the same anticipation he felt 20 years ago on the day CMLA opened its doors. He had been surrounded by his colleagues and friends, all of whom had invested their livelihoods, reputations and passions into this project. He had been nervous yet hopeful. While nobody knew what lay ahead, they were taking a risk to make their children’s futures brighter. In 1979 their collective vision had been to create a vehicle through which the youth of Los Angeles could discover, learn and dream about a world beyond their immediate scope. Today Corwin possesses a similar sense of inspiration and urgency.

At the dawn of a new millennium, in a world where too many children feel helpless and unimportant, Corwin believes that it is critical—now more than ever—to create a place where children’s voices are heard, their ideas are honored, their questions are taken seriously and their minds are challenged. A great deal is at stake going into this meeting: the Board can opt to stay put or choose to expand. Relocation would indeed leave much to the unknown, but with proper preparation and expert advisement, how can the Board go wrong? The words of Robert F. Kennedy come to his mind: “If not us, who? If not now, when?”

Epilogue

On August 27, 2000, CMLA closed its doors to focus all efforts on fundraising and planning for a new location in the Hansen Dam Recreational Area, bolstered by a $17.5 million grant from the City of Los Angeles. By 2002, a world-renowned architect and a cutting-edge green building plan had been selected, and estimated construction costs were rapidly increasing. Under the leadership of the Museum’s new executive director, Mark Dierking, formerly Padilla’s chief planning deputy, construction finally commenced in October 2005 with an opening slated for 2007.

CMLA faced extensive Board turnover, and the Museum was plagued by financial difficulties throughout the construction, failing to garner the support expected from San Fernando Valley residents and falling short of the funds needed to open the Museum on time. Padilla became President of the Los Angeles City Council and was later elected to the California State Senate. Richard Alarcón replaced him on the city council in March 2007. Facing growing media attention and constituent pressure to investigate potential financial mismanagement, Alarcón pulled nearly $1 million in public funds that Padilla had approved, and called for a city audit of the Museum. The completed audit revealed its troubled finances one month before the building’s completion, estimating that CMLA needed an additional $22 million before it could open. (See Appendix 6.)

After a last resort campaign for public support to build the exhibits, the Museum received a $10 million angel donation from the Friedman Foundation. The good news did not last long. In March 2009, just as the Museum was set to open, the foundation was investigated for fraud and had its assets frozen. In April 2009, in the wake of losing the $10 million donation, the Museum filed for bankruptcy. The empty building now sits in Hansen Dam, occasionally rented out by the City of Los Angeles for film shoots.

APPENDIX 1

Children’s Museum of Los Angeles Map

(Source: Children’s Environments Quarterly 1987)

APPENDIX 2

Children’s Museum of Los Angeles Board of Trustees 1999

(Source: Children’s Museum of Los Angeles Form 990 1999)

APPENDIX 3

Children’s Museum of Los Angeles 1998 Financial Statement

(Source: Children’s Museum of Los Angeles Form 990 1998)

APPENDIX 4

The Children’s Museum of Los Angeles

310 North Main Street Downtown Los Angeles (A)

(Source: Google Maps 2010)

APPENDIX 5

The Children’s Museum of Los Angeles Downtown Location (A)

Hansen Dam Recreational Area (B)

(Source: Google Maps 2010)

APPENDIX 6

Source: (City Controller Chick 2007)

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