I.
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Calling of the Meeting to Order - Diane B. Wilsey, President
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A meeting of the Board of Trustees of the Fine Arts Museums of San Francisco was held on Thursday, January 31, 2002, in the Board Room of the California Palace of the Legion of Honor, Lincoln Park, San Francisco. A quorum was present that being one-third of the number of Trustees in office. The meeting was called to order at 1:40 p.m. It was noted that the meeting was scheduled to begin at 1:30 p.m. with a workshop on the New de Young Financing Plan to address issues raised in a tax exempt bond financing for the new building and the associated draft Lease and Facilities Agreement between the Fine Arts Museums of San Francisco and The Fine Arts Museums Foundation. Regular business was scheduled to commence at 3:00 p.m. Additionally, it was noted that the date of the meeting changed from January 10, 2002 to January 31, 2002 in order to accommodate the City review and approval process for the revisions to the Final Environmental Impact Report for the new de Young Museum. Because of these changes in meeting time and date, this meeting was noticed as a special meeting of the Board of Trustees.
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II.
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Calling of the Roll
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The following Trustees were present:
Del M. Anderson
Alvin H. Baum, Jr.
Jamie Nicol Bowles
T. Robert Burke
Barnaby Conrad III
Marion Moore Cope
Belva Davis, Vice President/Civic Affairs and Audience Development
Dagmar Dolby
Richard P. Essey
Morgan Flagg
Harrison S. Fraker, Jr.
Dr. Rupert Garcia
Constance Goodyear
George Hecksher
Stephen L. Johnson
William R. Kimball
Diane B. Lloyd-Butler, Vice President/Marketing and Communications
Nion McEvoy
J. Alec Merriam, Vice President
Josie Mooney
Joy Ou
Marianne H. Peterson
Shelagh Rohlen, Vice President/Annual Support
George B. Saxe
Randolph R. Scott
Vivian Fei Tsen
Carlos Villa
Nancy Willis
Diane B. Wilsey, President
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On motion, duly seconded and carried unanimously, the following Trustees were excused:
Cheryl H. Bancroft
Alix Phillips Becker
George McNear Bowles
Barbara B. Carleton
Iris S. Chan
Richard H. Finn
Mara Fritz
Richard N. Goldman
Nancy Hamon
Jacqueline Hoefer
Ann L. Johnson, M.D.
Terrence Johnson
Nancy McBean
Lorna F. Meyer
Robert P. Morrow III, Vice President/Finance
Lonna Wais
Margaret Wetzel
David Winton
The following ex-officio Trustees were unable to be present:
Mayor Willie L. Brown, Jr.
Gordon Chin, President, Recreation and Park Commission
Other Trustees in attendance were:
Keith Eickman
George Hopper Fitch
William Fries II
Frankie Jacobs Gillette
Richard W. Goss II
David R. Hoyer
Leonard E. Kingsley
Sylvia Kingsley
Stephanie MacColl
Gail Merriam
Steven MacGregor Read
Katharine Doyle Spann
William A. Stimson
Florence Sue Wong
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III.
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Workshop on the New de Young Financing Plan to Address Issues Raised in a Tax-Exempt Bond Financing for the New Building and the Associated Lease and Facilities Agreement Between the Fine Arts Museums of San Francisco and The Fine Arts Museums Foundation
The workshop commenced with the clarification that no action would be taken during the workshop portion of the discussions. Consideration of the New de Young Financing Plan and the Lease and Facilities Agreement between the Fine Arts Museums of San Francisco (FAMSF) and The Fine Arts Museums Foundation (Foundation) will continue as Items III. D. and III. E. later in the agenda. Public testimony will occur following the latter discussions of these matters and before the Trustees take any action.
Mr. Parker reported that during the past two years, the Foundation has considered at length and in depth the most effective way to finance the construction of the New
de Young Museum in Golden Gate Park. Following the loss of the second proposed City and County of San Francisco general obligation bond measure in 1998, Mayor Willie L. Brown, Jr., offered the assistance of Monique Moyer, Director of Public Finance, Mayor’s Office of Public Finance, to assist in structuring the most cost efficient financing for the New de Young Museum.
He introduced Ms. Moyer, who in turn introduced the other members of the New
de Young Financing Team: Nikolai J. Sklaroff, SalomonSmithBarney; Richard W. Chisholm, Banc of America Securities LLC; Michael Cohen, Deputy City Attorney (Real Estate); William Madison, Esq., Jones Hall (Bond Counsel); Adam Sachs, Esq., Folger Levin & Kahn (the Museums’ 501(c)(3) counsel); and Steve Dykes, Deputy Director for Administration and Finance. It was noted that President Wilsey and Director Parker also participate as members of the New de Young Financing Team, as well as Deputy City Attorneys Adine Varah, Hazel Brandt, and Theresa Alvarez, and Sean Tierney, Hawkins, Delafield & Wood (Underwriters Counsel).
Ms. Moyer reported that the Financing Team analyzed a number of financial structures before recommending tax exempt financing available to nonprofit organizations as a means of financing the New de Young Museum. She reviewed the document entitled, "The New de Young Museum / Fine Arts Museums Board of Trustees / Finance Workshop / January 31, 2002", distributed at the meeting and attached to these minutes as Appendix I. A second document, "New de Young Museum, Revenue Bonds, Series 2002, Fine Arts Museums Board of Trustees, Workshop, January 31, 2002" was distributed for review prior to the meeting.
Ms. Moyer noted the exceptional capital campaign, which has raised over $152 million in cash gifts and pledges to date towards the $165 million campaign goal. The cost of the construction is $185 million, $20 million more than the campaign goal. The schedule of donor pledges over a five year period and the construction schedule for the New de Young Museum will require contractor payments before the pledges are received. The majority of the spending will occur within three years of construction. The foremost reason for issuing the debt is to provide a bridge loan for the cash to pay construction costs while the pledge receipts are being received.
Secondly, the bond offering is necessary to make up the $20 million difference between the $185 million construction cost and the $165 million fund-raising campaign. The bond offering is an opportunity to maximize legal arbitrage on the invested funds, which is a common transaction for 501(c)(3) entities, particularly for universities. The New de Young funds will be invested at interest rates higher than the interest rates paid to carry the debt. Unrestricted pledge money will be deposited into the New de Young Fund of the Foundation, which will be part of the balance sheet. Investment income will cover annual debt service and bond payment in about thirty years.
Short-term Variable Rate Demand Obligations and Auction Rate Securities would be issued with a guaranteed investment contract, generating a 135 basis point return (1.35%) higher than interest costs. For example, an interest rate of approximately 2% could be paid with guaranteed earnings of 3.35%.
An entity licensed to issue the bonds is required. It is recommended that the ABAG Finance Authority for Nonprofit Corporations, one of three licensed entities in California, serve as the conduit issuer of the bonds. The borrowers are the Foundation
and the Corporation of The Fine Arts Museums (COFAM), both qualified 501(c)(3) organizations. The amount to be borrowed is approximately $128,350,000 (70% lien-to-equity ratio) over a 30 year term payable in full at any time without penalty. This amount is preliminary and subject to change. The security for the transaction is the full faith and credit of the co-borrowers and excludes restricted assets (donations, grants, restricted endowment, etc.), and the art collection. The rating on the bonds will be in the A- to A range as mid-level investment grade bonds. Bids from the bond insurers are due soon.
Ms. Moyer responded to questions raised by Trustees Willis, Jamieson, Flagg, Scott, Saxe, Burke and Hecksher as follows:
· The bonds will mature in thirty years. They are payable in full at any time without penalty.
· Unlike a fixed interest rate bond, the bonds will be resold every thirty days.
· The Board of Supervisors will need to adopt a TEFRA (Tax Equity and Fiscal Responsibility Act) resolution, following the December 17, 2001 public hearing regarding the New de Young tax exempt bonds held by the Director of Public Finance. The ABAG Finance Authority for Nonprofit Corporations will issue the bonds and loan the proceeds to COFAM and the Foundation to build the New
de Young Museum. Federal tax law requires public notice and a hearing under these circumstances. The Board of Supervisors will not take a position on the creditworthiness of the New de Young financing, nor is the City responsible to meet bond debt service and payment.
· The collateral required for a bank loan is substantially more than COFAM and the Foundation have available.
· A guaranteed investment contract will be purchased from a Wall Street firm to invest the money and deliver a guaranteed return locking in a 135 basis point spread above a municipal bond market index.
· Deputy City Attorney Michael Cohen then discussed the Lease and Facilities Agreement for the New M. H. de Young Museum attached as Appendix II, which serves to enhance the creditworthiness of the bonds. Once the new building is finished, title passes to the City, which leases it back to the Foundation for up to thirty-five years. The lease avoids attempting to re-characterize or re-define the roles or responsibilities of FAMSF under the San Francisco Charter or the Administrative Code. Instead, those laws are simply incorporated by reference, so that if they are amended at a later date, those changes will occur automatically without having to amend the lease itself.
· The lease codifies FAMSF’s relationship with the Foundation and preserves for FAMSF maximum flexibility in making future decisions regarding the Museums while still achieving the underlying goal of enhancing the creditworthiness of the bonds. Furthermore, in recognition of the Tenant’s charitable function, it shields the Foundation from open-ended financial and legal liabilities. In this regard, the lease in many respects operates more like a management agreement (with the Foundation managing the City’s asset pursuant to the City’s direction) than a lease (where the City would normally transfer most of the control and the financial obligations and liabilities of the Foundation).
· The lease also preserves in FAMSF the flexibility to define the respective roles and responsibility of the City and the Foundation for the use and operation of the new Museum for the next thirty-five years and sets forth processes for allocating rights and responsibilities instead of attempting to allocate those rights and responsibilities in the lease itself. The key element of that process is a requirement that FAMSF approve each year a management plan governing the use and operation of the Museum.
The principal way in which the lease enhances the creditworthiness of the bonds is through a negative pledge, which imposes a strict limitation on FAMSF’s ability to encumber or otherwise dispose of the new Museum during the term of the lease. Specifically, the lease prohibits FAMSF from creating any new encumbrance on the premises, without the prior written consent of the Foundation and limits FAMSF’s ability to sell or otherwise dispose of a material portion of the Museum.
At the request of Mr. Parker, and in response to questions raised by Trustees Tsen and Burke, Deborah Frieden, de Young Project Director, clarified that demolition is scheduled to begin in March 2002, with excavation following in June and construction commencing in the fall. A guaranteed, final construction cost will not be known until November 2002 when all the bidding on the project is completed. Ms. Moyer noted that the insurers are impressed by the success of the capital campaign. It is unusual to issue the debt in advance of a signed construction contract with a guaranteed maximum price. Mr. Parker stated that it was decided to proceed without a guaranteed maximum price because it is advantageous to begin earning interest to pay for construction costs as soon as possible.
Trustee Kingsley then reiterated the thoughtful and detailed deliberations of the Board of Trustees of the Foundation over the past two years to identify the most effective way to finance the construction of the New de Young Museum.
In conclusion, Ms. Moyer reviewed the revised financing schedule, noting that a special meeting of the Board of Trustees of the Foundation has been set for March 12, 2002 to finalize the New de Young Financing Plan and the Lease and Facilities Agreement; that the Executive Committee of the COFAM Board of Trustees is scheduled to consider approval of the Borrowers Documents on March 14, 2002; that the ABAG Finance Authority hearing and approval will take place on March 18, 2002; with the sale of the bonds scheduled for March 26, 2002 and the bond closing on April 3, 2002.
Mr. Parker emphasized the importance of maintaining a strong public component to the Fine Arts Museums. The history of the Museums and its collections are rooted in its public orientation. The narrow defeat of two proposed City of San Francisco general obligation bond measures in 1996 and 1998 resulted in the Board’s decision to raise the funds required to build the New de Young Museum from private sources. As we move forward, the role and responsibilities of the private sector may take on even greater significance.
There being no further questions, the Board of Trustees expressed appreciation to Ms. Moyer and the members of the New de Young Financing Team for their diligent efforts in developing the New de Young Financing Plan with a round of applause.
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IV.
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Report of the President - Diane B. Wilsey
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A. Consideration and Possible Action to Approve the Minutes of the December 13, 2001 Meeting of the Executive Committee of the Board of Trustees
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There being no discussion among the Trustees or members of the public, the minutes of the December 13, 2001 meeting of the Executive Committee of the Board of Trustees, having been mailed in advance to all Trustees, were unanimously approved.
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B. Report on 2001 Year-End Gifts of Works of Art - J. Alec Merriam,
Chair, Acquisitions Committee of The Fine Arts Museums Foundation
At the request of Chair Merriam, Steve Nash, Associate Director and Chief Curator, presented the Report on 2001 Year-end Gifts of Works of Art. Approximately 350 works of art were received as listed in Appendix III of these minutes. These gifts were accepted with sincere appreciation to each donor pursuant to Board Resolution 1393, which allowed the Director or his designee to accept the year-end gifts to the Fine Arts Museums of San Francisco or The Fine Arts Museums Foundation during the period from November 30, 2001 (last meeting of the Acquisitions Committee) through December 31, 2001.
Dr. Nash discussed several of the year-end gifts: 1) Ghana, Portrait Head of a Royal Person, 17th century; 2) 58 objects from the Philippines; 3) a major painting by Wayne Thiebaud, Ponds and Streams, 2001 (90% partial interest); 4) an additional 10% partial interest in Portrait of Albert Post, circa 1864, by Winslow Homer; 5) Flower Girl,
early 20th century, by Nicolai Fechin (25% partial interest); 6) Two Piece Reclining Figure No. 9, 1968, by Henry Moore (10% partial interest); 7) a group of large-scale photographs mostly from Egypt, G. Lekegian and Company (France), active mid-19th century;
8) Western Hills Memorial City, Lawndale, California (Project for Mrs. Annie Darbee),
ca. 1939, by Bernard Maybeck; 9) Turkmen, Yomut sub-group, Asia, Main Carpet,
18th century; and 10) a gift of costumes from the mid-1930s.
In closing, Dr. Nash presented a recent purchase, Nacht I (Die Nacht I), by Albert Bloch (American, 1882-1961), which was on view during the meeting.
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C. Report on Recent Developments Regarding the Plans to Build a New
de Young Museum in Golden Gate Park
1. Presentation on Recent Developments Regarding the Design of the New
de Young Museum in Golden Gate Park - Pierre de Meuron, Herzog & de Meuron Architekten AG
President Wilsey introduced Pierre de Meuron, Herzog & de Meuron Architekten AG, who presented recent developments regarding the design of the New de Young Museum in Golden Gate Park. Mr. de Meuron began by stating that it has been three years since Herzog & de Meuron Architeckten AG was selected as the architects for the New
de Young Museum. His presentation summarized the three years of planning and design development, most of which had been previously presented to the Board of Trustees. He expressed his gratitude for this opportunity and his confidence in the project, pointing out that the architecture will reflect the open and ongoing dialogue between the architectural team, staff, Trustees, and community members, and the diverse cultures represented in the Museums’ permanent collection. The following highlights his power point presentation:
· The geometry of the New de Young in relation to the Concourse and the Academy of Sciences, and the City of San Francisco is important. The primary relationship of the Museum to the Concourse and the Academy of Sciences will not change.
· The design merges nature and architecture. The building is comprised of three bands with spaces between each band, which allow the Park to penetrate into the building and the building to reach into the Park.
· The architecture of the three bands allows for galleries and courts, and brings daylight into the Museum. The bands meet becoming connecting points between the different areas of the Museum and the collections. Each collection occupies its own unique space but is related to the other collections.
· The new building totals approximately 292,000 square feet with a smaller footprint than the former de Young/Asian building, thereby returning green area back to the Park.
· There are three ground level entry points: a) the main entrance on the Concourse; b) a northeast entrance at the Garden of Enchantment off Kennedy Drive; and c) a southwest entrance from the proposed sculpture garden adjacent to the Japanese Tea Garden.
· There is a double-height main court in the center of the building, where orientation to the entire museum including all of the galleries is possible. Each of the collections can be accessed from the main court, and the public will be able to walk through the building on the ground level without charge. The museum store, Family Room, children’s gallery, auditorium, catering and kitchen spaces, restaurant and restrooms are located on the ground floor.
· Native American art and 20th century American art galleries are located on the 1st level. The main stairway leads to the 2nd floor, which houses the Africa, Art of the Pacific Islands, 19th century American art, and the Textiles galleries. The Textiles conservation labs are also located on the 2nd floor. The below ground level connects directly to the proposed underground parking garage being planned by the Concourse Authority. Temporary exhibition space, an auditorium, which can also be accessed via the ground floor, storage and plant facilities are located on this lower level.
· The 19th century and contemporary galleries are classical in nature with the works of art hung on the walls and sculpture and furniture objects placed within the space. Objects from other cultures, primarily religious in nature and not originally created for museum viewing such as the works in the Africa, Oceania and the Americas collection, occupy more fluid spaces utilizing large vitrines.
· The education tower is an important architectural feature of the new building. It is a vertical element intended to serve as an institutional and architectural landmark. At its base, the tower reflects the geometry of the Concourse and twists upward to represent the geometry of the City at its top. It is a symbolic link between Golden Gate Park and the City. It will house the various components of the education program, including class rooms, artist studios, volunteer and docent space. The observation floor at the top will provide a 360 degree view of the Park and
San Francisco.
· The copper façade concept developed from pictures of trees in the Park, which were transformed into black and white images of leaves representing the play of light and shadow. Negatives of the images were pixalized, and a pattern of the digitized images developed. The three-dimensional digitized images are embossed on industrialized copper. The panels vary with differing degrees of perforation, solidity, flatness, and embossing, all reflecting the landscape of the Park. Over time, the copper will develop a patina and turn green.
Mr. de Meuron concluded his presentation. The Board of Trustees acknowledged
Mr. de Meuron and his presentation on the design for the New de Young Museum in Golden Gate Park with an enthusiastic round of applause.
Trustee Steven Macgregor Read, Chair of the New de Young Building Committee, reported that at its meeting on January 29, 2002, the Committee reviewed the design in detail and recommended approval of the New de Young Museum design to the Board of Trustees for approval.
2. Report on the December 6, 2001 Public Hearing Before the San Francisco Planning Commission Regarding the Revisions to the Final Environmental Impact Report (FEIR) for the Proposed de Young Museum Project Pertaining to the Height of the Education Tower and to Some Aspects of the Analysis of the Impact on Historic Resources and the San Francisco Planning Commission’s Action to Certify the Revisions to the FEIR for the Proposed de Young Museum
President Wilsey reported on the December 6, 2001 public hearing before the
San Francisco Planning Commission regarding the revisions to the Final Environmental Impact Report (FEIR) for the proposed de Young Museum project. The revised FEIR corrected sections pertaining to the height of the Tower and the related analyses, as well as
some aspects of the analysis of the impacts on historic resources. The Planning Commission voted unanimously to certify the revised FEIR.
3. Report on the Public Hearing of the Board of Supervisors on January 14, 2002 Regarding the Appeal of the Planning Commission’s Certification of the Revised Final Environmental Impact Report (FEIR) for the Proposed
de Young Museum Project, Which Includes Revisions Pertaining to the Height of the Education Tower and to Some Aspects of the Analysis of the Impact on Historic Resources, and the Subsequent Action of the Board of Supervisors to Uphold the Decision of the San Francisco Planning Commission to Certify the Revised FEIR for the Proposed de Young Museum Project
On January 14, 2002, a public hearing before the Board of Supervisors was held regarding the appeal of the Planning Commission’s Certification of the revised FEIR for the proposed de Young Museum project. President Wilsey advised that the Board of Supervisors voted ten to one to uphold the decision of the San Francisco Planning Commission made on December 6, 2001 to certify the revised FEIR.
4. Report on the Public Hearing of the Recreation and Park Commission on January 17, 2002 Regarding the Shadow Impacts of the New de Young Museum Project on Golden Gate Park
A public hearing before the Recreation and Park Commission was held on January 17, 2002 regarding the shadow impacts of the de Young Museum project on Golden Gate Park. President Wilsey reported that the Recreation and Park Commission determined by a unanimous vote that the shadow impacts are not significant.
5. Report on the Public Hearing of the San Francisco Planning Commission on January 24, 2002 and Its Determination Regarding (a) Findings Pursuant to California Environmental Quality Act Regarding the New de Young Museum Project, (b) Shadow Impacts of the New de Young Project on Golden Gate Park as Required by Planning Code Section 295, (c) Finding the New de Young Museum Project Consistent with the General Plan. Report on the Zoning Administrator’s Hearing Regarding the Parking Variance on January 24, 2002 Held Concurrently with Planning Commission Hearing
At the request of President Wilsey, Kate Stacy, Deputy City Attorney, reported on the January 24, 2002 public hearing before the San Francisco Planning Commission.
Ms. Stacy advised that the Planning Commission took three separate actions at the January 24, 2002 public hearing: 1) adopted findings pursuant to the California Environmental Quality Act addressing the environmental impacts of the New de Young Museum project;
2) adopted a motion finding that the shadow impacts of the de Young Museum project on Golden Gate Park were not significant; and 3) adopted a motion finding that the New
de Young Project was consistent with the General Plan. In addition, Ms. Stacy reported that the Zoning Administrator held a public hearing simultaneously with the Planning Commission public hearing on January 24, 2002, regarding the parking variance. The Museums had requested a variance from the code requirements to provide 156 parking spaces. On January 28, 2002, the Zoning Administrator issued his decision granting the parking variance. It was noted that the Planning Commission draft motions regarding the General Plan referral and the shadow impacts determination were distributed for review prior to the meeting.
President Wilsey particularly recognized the efforts of Director Parker and members of the senior management staff regarding the successful outcome of the City approval process for the revised FEIR for the de Young Museum project.
6. Consideration and Possible Action to Adopt a Resolution Adopting the Findings Pursuant to California Environmental Quality Act Regarding the New de Young Museum Project Environmental Impact Report Including Mitigation Measures, Rejection of Alternatives, Statement of Overriding Considerations and Mitigation Monitoring Program, Approving the Design of the New de Young Museum Project and Authorizing the Corporation of The Fine Arts Museums to Proceed with the Project
President Wilsey introduced the resolution attached hereto as Appendix IV and which was distributed prior to the meeting. The resolution adopts the findings pursuant to the California Environmental Quality Act regarding the New de Young Museum Project Environmental Impact Report including mitigation measures, rejection of alternatives, statement of overriding considerations and mitigation monitoring program, approves the design of the New de Young Museum Project and authorizes the Corporation of The Fine Arts Museums to proceed with the Project.
A motion was made and seconded to adopt the resolution. Trustee Kingsley offered words of appreciation to President Wilsey and Director Parker for their extraordinary efforts and remarkable persistence in building a New de Young Museum in Golden Gate Park. The Board of Trustees acknowledged President Wilsey and Director Parker with a heartfelt round of applause. Trustee Fraker expressed gratitude on behalf of the architectural community to the architects and the Board of Trustees for the design achievement represented by the New de Young Museum. The New de Young will be a destination museum for the world to view. There was no further discussion among Trustees. There was no public testimony. The Board of Trustees voted unanimously to adopt the resolution attached hereto as Appendix IV as Board Resolution 1397.
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D. Consideration and Possible Action to Adopt a Resolution Approving the New de Young Financing Plan Proposed by the Corporation of the Fine Arts Museums and The Fine Arts Museums Foundation
President Wilsey pointed out that this resolution relates to the workshop held earlier in this meeting about the New de Young Financing Plan, involving the issuance of tax-exempt bonds. She proceeded to read the resolution as follows:
WHEREAS, The highest institutional priority of the Fine Arts Museums of
San Francisco is to build a New de Young Museum in Golden Gate Park; and
WHEREAS, Efforts to secure public funding for a New de Young Museum were unsuccessful with San Francisco general obligation bonds failing to meet the 66.7% requirement for passage in 1996 (62.6% yes votes) and 1998 (64.3% yes votes); and
WHEREAS, At the request of the Board of Trustees of the Fine Arts Museums of San Francisco, the Capital Campaign for a New de Young Museum was initiated by the Corporation of The Fine Arts Museums with a fund-raising goal of $165 million, of which over $150 million has been raised to date; and
WHEREAS, The schedule of pledges extends over a five year period, and the construction schedule for the New de Young Museum will require immediate payments before the pledges are received; and,
WHEREAS, The Board of Trustees of the Fine Arts Museums has reviewed the Final Environmental Impact Report for the New de Young Project, and adopted CEQA findings for approval of the Project at this January 31, 2002 meeting under Agenda Item III.C(6), which findings are incorporated by reference herein; now, therefore, be it
RESOLVED, That to meet the cash flow requirements for the construction of
the New de Young Museum, the Board of Trustees of the Fine Arts Museums of
San Francisco does hereby approve the New de Young Financing Plan and supports the decision of the Corporation of The Fine Arts Museums and The Fine Arts Museums Foundation to seek the sale and issuance of tax-exempt bonds by the appropriate state financing authority, which will be guaranteed by the future flow of pledges; and, be it
FURTHER RESOLVED, That the President of the Board of Trustees and Director of Museums are hereby authorized to take all necessary steps to facilitate the issuance of said tax-exempt bonds.
A motion was made and seconded to adopt the resolution. There was no additional discussion among Trustees or Trustees Emeriti. There was no public testimony. The Board of Trustees voted unanimously to adopt the above resolution as Board Resolution 1398.
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E. Consideration and Possible Action to Adopt a Resolution Approving the Draft Lease and Facilities Agreement Between the Fine Arts Museums of
San Francisco and The Fine Arts Museums Foundation and Authorizing the Director of Museums to Take All Necessary Steps to Finalize and Execute Such Agreement (Including Any Attached Exhibits) in Substantially the Form Attached Hereto and Approved as to Form by the City Attorney
President Wilsey noted that presentation and discussion of the Draft Lease and Facilities Agreement between the Fine Arts Museums of San Francisco and The Fine Arts Museums Foundation distributed prior to the meeting occurred during the workshop portion of the meeting. She then read the following resolution:
WHEREAS, The Board of Trustees of the Fine Arts Museums of San Francisco (FAMSF) has approved the New de Young Financing Plan and supports the decision of the Corporation of The Fine Arts Museums (COFAM) and The Fine Arts Museums Foundation (Foundation) to seek the sale and issuance of tax-exempt bonds by the appropriate state financing authority, which will be guaranteed by the future flow of pledges; and
WHEREAS, To secure such financing, the role of the Foundation is critical in generating future revenues required over the anticipated thirty year term of the tax-exempt bonds; and
WHEREAS, A Lease and Facilities Agreement between FAMSF and the Foundation defines the respective roles and responsibilities of FAMSF and the Foundation for the use and operation of the New de Young Museum and will help facilitate the financing for the New de Young Museum; and
WHEREAS, The Foundation is a non-profit charitable organization whose primary purpose is to support the activities of FAMSF; and
WHEREAS, The Board of Trustees of the Fine Arts Museums has reviewed the Final Environmental Impact Report for the New de Young Project and adopted CEQA findings for approval of the Project at this January 31, 2002 meeting under Agenda Item III.C(6), which findings are incorporated by reference herein; now, therefore, be it
RESOLVED, That the Board of Trustees of FAMSF hereby finds that in light of the Foundation’s primary charitable purpose to support the activities of FAMSF, the Foundation’s use of the museum facilities in accordance with the terms of the Lease and Facilities Agreement is an appropriate use of such museum facilities and will provide a benefit to FAMSF and the public; and, be it
FURTHER RESOLVED, That the Board of Trustees of FAMSF hereby approves of the Lease and Facilities Agreement between FAMSF and the Foundation and the transaction contemplated therein and authorizes the Director of Museums to take all necessary steps to finalize and execute the Lease and Facilities Agreement (including any attached exhibits) in substantially the form attached hereto and approved as to form by the City Attorney; and, be it
FURTHER RESOLVED, That the Board of Trustees of FAMSF further authorizes the Director of Museums to enter into any additions, amendments or other modifications to the Lease and Facilities Agreement (including, without limitation, the attached exhibits), approved as to form by the City Attorney, that the Director of Museums determines are in the best interests of FAMSF, do not decrease the benefit to FAMSF or otherwise materially increase the obligations or liabilities of FAMSF in connection with the Lease and Facilities Agreement, and are necessary or advisable to complete the transaction contemplated in the Lease and Facilities Agreement and to effectuate the purpose and intent of this resolution; and, be it
FURTHER RESOLVED, That any actions previously taken by any City employee or official with respect to the Lease and Facilities Agreement are hereby ratified and affirmed.
President Wilsey stated that because of her role as a Board member of The Fine Arts Museums Foundation she would abstain from voting and participating in discussion of the Draft Lease and Facilities Agreement between FAMSF Board of Trustees and the Foundation. Likewise, due to his role as a Board member of The Fine Arts Museums Foundation, Trustee J. Alec Merriam also abstained from voting and participating in discussion of the proposed Lease and Facilities Agreement between the FAMSF Board of Trustees and the Foundation.
A motion was made and seconded to adopt the resolution. There was no additional discussion among Trustees or Trustees Emeriti. There was no public testimony. The
Board of Trustees voted unanimously to adopt the above resolution as Board Resolution 1399.
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F. Report of the Nominating Committee - Nion McEvoy, Chair
1. Consideration and Possible Action to Accept the Resignation of Terrence Johnson from the Board of Trustees of the Fine Arts Museums of
San Francisco
In the absence of Chair McEvoy, President Wilsey reported that Trustee Terrence Johnson has expressed the need to resign from the Board of Trustees. Increased business obligations preclude his continued, active participation as a member of the Board. A motion was made and seconded. There was no discussion among Trustees. There was no public testimony. The Board of Trustees voted unanimously to accept with regret the resignation of Terrence Johnson from the Board of Trustees of the Fine Arts Museums of
San Francisco.
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F. Report on the Cancellation of the February 14, 2002 Executive Committee Meeting
President Wilsey reported that the February 14, 2002 meeting of the Executive Committee of the Board of Trustees has been canceled.
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V.
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Director’s Report - Harry S. Parker III
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A. Consideration and Possible Action to Approve Two Additional Venues to a Previously Approved Loan Request
Mr. Parker presented the two additional venues to a loan request approved by the Board of Trustees at its October 18, 2001 meeting:
From: Museum of Contemporary Art
For: Willem de Kooning: Tracing the Figure
Museum of Contemporary Art, Los Angeles: 2/10/02 - 4/28/02
San Francisco Museum of Modern Art, San Francisco: 6/15/02 - 9/8/02
National Gallery of Art, Washington, D.C.: 9/29/02 - 1/5/03
Willem de Kooning (American, 1904-1997)
Untitled (Two Figures), circa 1947
Oil, watercolor, charcoal, and graphite, 57.2 x 55.9 cm
Fine Arts Museums of San Francisco, Museum Purchase,
Gift of Mrs. Paul L. Wattis
Stipulations: The work of art will be accompanied by a FAMSF courier to
Los Angeles and return from Washington, D.C. All related expenses will be paid by the requesting organization.
A motion was made and seconded. There was no discussion among Trustees or members of the public. The Board of Trustees voted unanimously to approve the two additional venues to the loan request.
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B. Consideration and Possible Action to Adopt Notice and Appeal Procedures for Removal of Trees on Property under the Jurisdiction of the Fine Arts Museums of San Francisco Pursuant to Resolution 722-98 Approved by the Board of Supervisors Urging Departments to Adopt Such Policies and Procedures
Mr. Parker stated that the Board of Supervisors adopted Resolution 722-98 urging all departments to adopt notice and appeal procedures for removal of trees that are visible from the public right of way on property under the jurisdiction of the respective City agency, commission or department. He introduced the following resolution to adopt the appended Tree Removal Procedures Pursuant to Board of Supervisors’ Resolution 722-98, which were distributed at the meeting:
WHEREAS, Pursuant to Section 5.101 of the San Francisco Charter, the Board of Trustees of the Fine Arts Museums of San Francisco (FAMSF) "...shall have exclusive charge of the trusts and all other assets under their jurisdiction, which may be acquired by loan, purchase, gift, devise, bequest or otherwise, including any land or buildings set aside for their use."; and
WHEREAS, The San Francisco Board of Supervisors adopted Resolution 722-98 urging all departments to adopt "notice and appeal procedures for removal of trees that are visible from the public right of way on property under the jurisdiction of the respective City agency, commission or department"; and
WHEREAS, Pursuant to Section 4.113 of the San Francisco Charter, the Recreation and Park Department is responsible for the maintenance of the lands under the jurisdiction of the Fine Arts Museums; and
WHEREAS, The Recreation and Park Department has responsibility for the maintenance and planning of both Golden Gate Park and Lincoln Park, and therefore must be able to make decisions that allow it to fulfill that responsibility, including to maintain the broader park landscape from disease, age, and other hazards, and to protect the safety of the public; and
WHEREAS, The FAMSF entered into a Memorandum of Understanding (MOU) with the Recreation and Park Department, which was approved by the FAMSF Executive Committee of the Board of Trustees on September 7, 2000 and the Recreation and Park Commission on September 20, 2000, that clarifies the working relationship of the two departments; now, therefore, be it
RESOLVED, That the Board of Trustees of FAMSF hereby adopts the attached Policy for Notice of Tree Removal made under its direction; and, be it
FURTHER RESOLVED, That the Policy shall not alter the FAMSF obligations under the MOU nor shall it affect the obligation of either the Recreation and Park Department or FAMSF under the San Francisco Charter; and, be it
FURTHER RESOLVED, That the Director of Museums is authorized to review public comment or appeal and render a decision regarding tree removal on the property of FAMSF.
A motion was made and seconded to adopt the resolution and appended Tree Removal Procedures Pursuant to Board of Supervisors’ Resolution 722-98. There was no discussion among Trustees. There was no public testimony. The Board of Trustees voted
unanimously to adopt the above resolution and appended Tree Removal Procedures Pursuant to Board of Supervisors’ Resolution 722-98 as Board Resolution 1400.
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C. Consideration and Possible Action to Adopt a Resolution Acknowledging Funding Expended by the Corporation of The Fine Arts Museums During the Period July 1 through September 30, 2001
Mr. Parker advised that the City’s Sunshine Ordinance requires the Fine Arts Museums to disclose the amount and source of all gifts received. He presented the following resolution, which acknowledges funding expended by the Corporation of The Fine Arts Museums for the period July 1 through September 30, 2001:
WHEREAS, The Corporation of The Fine Arts Museums is a 501(c)(3) not-for-
profit corporation that exists to support the activities of the Fine Arts Museums of
San Francisco and to serve as the developer of the New de Young Museum, and has a partial reimbursement contract with the Fine Arts Museums of San Francisco; now, therefore, be it
RESOLVED, That the Board of Trustees of the Fine Arts Museums of
San Francisco does hereby acknowledge with gratitude funding in the amount of $2,906,602 expended by the Corporation of The Fine Arts Museums for operations and $1,478,451 for the New de Young Museum in Golden Gate Park during the period July 1 through September 30, 2001.
A motion was made and seconded to adopt the resolution. There was no discussion among Trustees. There was no public testimony. The Board of Trustees voted unanimously to adopt the above resolution as Board Resolution 1401.
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D. Consideration and Possible Action to Adopt a Resolution Acknowledging a Bequest Received by the Fine Arts Museums of San Francisco for the Period July 1 through September 30, 2001
In accordance with the City’s Sunshine Ordinance, bequests received by the Fine Arts Museums must also be disclosed. Mr. Parker introduced the following resolution
acknowledging a bequest received by the Museums for the period July l through September 30, 2001:
RESOLVED, That the Board of Trustees of the Fine Arts Museums of
San Francisco does hereby acknowledge with gratitude the following bequest received during the period July 1 through September 30, 2001:
Estate of Lester Hamilton, $17,920
A motion was made and seconded to adopt the resolution. There was no discussion among Trustees. There was no public testimony. The Board of Trustees voted unanimously to adopt the above resolution as Board Resolution 1402.
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E. Report on January 9-11, 2002 American Association of Museums
Re-Accreditation Visit
The re-accreditation visit, originally scheduled for September 11-12, 2001, occurred on January 9-11, 2002. The members of the Re-Accreditation Visiting Committee were Henry Adams, Curator of American Art at the Cleveland Museum of Art, and Mimi Gates, Director of the Seattle Art Museum. Their visit included meetings with the officers of the Board, curators and key staff, and a tour of all the Museums’ sites - the Interim de Young, de Young Art Center, Museum Warehouse, Post Street Administrative Offices, Legion of Honor, and the closed de Young Museum building. The re-accreditation report is expected in approximately six months. Mr. Parker advised that re-accreditation of the Museums is anticipated. However, the Visiting Committee did express concern over the impact of the number of off-site facilities on day-to-day operations. They recognized the unique circumstance of building the new de Young Museum on the same site as the old and the subsequent need for temporary, additional sites.
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F. Update on the City Budget
Mr. Parker explained that the September 11, 2001 terrorist attacks, the decline in tourism in San Francisco, and the general economic recession have adversely affected Hotel Tax proceeds, which pay for the Museums’ City budget. Budget cuts were proposed for all of the City’s art and cultural departments supported by the Hotel Tax, including a $900k mid-year cut for the Museums. This budget cut will be covered by $600k in expense reductions and $300k from an interdepartmental loan from the War Memorial Commission. The source of War Memorial funds is a surplus of Hotel Tax funds built up for Opera House and Veterans’ Building seismic work in 2007 to be repaid with no interest.
Expense reductions of $600 k include: a) freezing five vacant positions;
b) deleting the $243k COFAM Education Program reimbursement; and c) reducing the utility bill by $75k by lowering temperatures and expanding humidity ranges, while still providing art conservation and people comfort conditions.
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G. Consideration and Possible Action to Adopt a Resolution Authorizing the Board President and Director of Museums to Submit the Fiscal Year 2002-2003 City Budget Request
RESOLVED, That the Board of Trustees of the Fine Arts Museums of
San Francisco does hereby authorize the Board President and the Director of Museums to sign and submit the Fiscal Year 2002-2003 City Budget request for the Fine Arts Museums of San Francisco.
A motion was made and seconded to adopt the resolution. There was no discussion among Trustees. There was no public testimony. The Board of Trustees voted unanimously to adopt the above resolution as Board Resolution 1403.
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H. Current and Future Exhibits
Mr. Parker reported that Masterworks of New Guinea Art: Selections from the Marcia and John Friede Collection has been installed in Gallery 6 at the Legion of Honor. It opens on February 6 and runs through May 2, 2002. The nineteen major objects featured in the exhibition were acquired for the New de Young Museum through the generosity of Marcia and John Friede and the Phyllis Wattis Purchase Fund.
At Mr. Parker’s request, Krista Davis, Associate Curator for Exhibitions, discussed Dreaming with Open Eyes: Dada and Surrealist Art from the Vera, Silvia, and Arturo Schwarz Collection in the Israel Museum, which opens tonight in Rosekrans Court and Galleries B-F. It runs through April 28, 2002. Over 200 works from sculpture and painting to film and photography, demonstrate the experimental nature of both the Dada and Surrealism movements as artists drew upon such devices as dream imagery, unconscious writing, found objects, humor, parody, and collage to attack traditional notions of art. Among the many artists represented are Marcel Duchamp, Man Ray, René Magritte, Max Ernst, Joan Mirό, Kay Sage, Francis Picabia, Dorothea Tanning, and Salvador Dali.
Trustees were encouraged to attend the opening of Dada and Surrealist Art and to view Masterworks of New Guinea Art immediately following the conclusion of the meeting.
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VI.
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Public Comment
Members of the public may address the Board of Trustees on items not on the agenda that are within the subject matter jurisdiction of the Fine Arts Museums of
San Francisco. Speakers may address the Board for up to three minutes; the President or the Board of Trustees may limit the total comment to thirty minutes. There was no public comment.
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VII.
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Meeting Schedule, Future Events and Current and Future Exhibits
A. Executive Committee Meetings
Date Time Location
February 14, 2002 noon 6th Floor, 233 Post Street CANCELED
March 14, 2002 noon 6th Floor, 233 Post Street
May 9, 2002 noon 6th Floor, 233 Post Street
September 12, 2002 noon 6th Floor, 233 Post Street
November 14, 2002 noon 6th Floor, 233 Post Street
December 12, 2002 noon 6th Floor, 233 Post Street
B. Board of Trustees Meetings
January 31, 20021 3 p.m. Board Room, Legion of Honor
April 11, 2002 3 p.m. Board Room, Legion of Honor
October 10, 2002 3 p.m. Board Room, Legion of Honor
C. Future Events
Date Event
January 31, 2002 Opening of Dreaming with Open Eyes: The Vera, Silvia, and Arturo Schwarz Collection of Dada and Surrealist Art in the Israel Museum
February 6, 2002 Opening of Masterworks of New GuineaArt:
February 7, 2002 Tribal Arts Show Benefit
March 2-9, 2002 Museum Associates Trip to the Netherlands
March 11-15, 2002 Bouquets to Art
May 15-19, 2002 New de Young Museum Groundbreaking
June 13, 2002 Opening of Michael Sweerts: Traveling Artist of the 17th Century
D. Current and Future Exhibitions (*Exhibitions organized by FAMSF)
Title Date Museum/Gallery
Triumph of Fortitude and Triumph 02/10/01-02/24/02 Legion 2/3
of Prudence
Recent Acquisitions of Contemporary 10/27/01-02/24/02 Legion 1
California Works on Paper*
Richard Diebenkorn: Clubs and Spades* 01/19/02-04/28/02 Legion A
A toute épreuve: An Artists Book 01/26/02-05/19/02 Legion L
Masterpiece by Joan Miró
Masterworks of New Guinea Art:
Selections from The Marcia 02/02/02-04/28/02 Legion 6
and John Friede Collection*
Dreaming with Open Eyes: Dada and 02/02/02-04/28/02 Legion B-F
Surrealist Art from the Vera, Silvia, Rosekrans
and Arturo Schwarz Collection
in the Israel Museum, Jerusalem
Bouquets to Art 03/12/02-03/15/02 Legion All
Recent Acquisitions of Contemporary 03/09/02-06/23/02 Legion 1
Works on Paper, Part II: Everywhere
but California*
Logan Book Gallery 05/25/02-09/15/02 Legion L
Michael Sweerts: Traveling Artist 06/1502-08/25/02 Legion 6
of the 17th Century*
Eternal Egypt: Masterworks of Ancient 08/10/02-11/03/02 Legion A-F,
Art from The British Museum Rosekrans, 10
Philip Guston* 10/12/02-01/00/03 Legion 1
Hard Edge: Abstract Prints from Albers 11/30/02-03/23/03 Legion A
to Held*
Casting a Spell: Winslow Homer, Artist 12/07/02-02/09/03 Legion B-F,
And Angler* Rosekrans
Leonardo da Vinci and The Splendor of 03/11/03-03/14/03 Legion B-F,
Poland Rosekrans
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VIII.
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Adjournment in Memory of Trustee Emeritus John N. Rosekrans, Jr., and Trustee Emeritus Alfred S. Wilsey - Diane B. Wilsey, President
Mr. Parker stated that the meeting was being adjourned in memory of two of the Museums’ most extraordinary Trustees. Trustee Emeritus John N. Rosekrans, Jr., passed away in Paris at the end of October 2001, and his memorial service was fittingly held in the Adolph B. and Alma de Bretteville Spreckels Gallery at the Legion of Honor on November 5, 2001.
Trustee Emeritus Albert S. Wilsey passed away on January 4, 2002. At the time of his death, he was a Trustee of The Fine Arts Museums Foundation, having previously
served on the Board of Trustees of the Fine Arts Museums since 1981. On behalf of the Board of Trustees, Mr. Parker expressed heartfelt condolences to President Wilsey.
There being no further business, President Wilsey adjourned the meeting at 4:35 p.m. in memory of Trustee Emeritus John N. Rosekrans, Jr., and Trustee Emeritus Alfred S. Wilsey.
Respectfully submitted,
Judy Gough
Executive Secretary
Note: These minutes set forth all actions taken up by the Board of Trustees on matters stated, but not necessarily in the order in which the matters were considered.
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