City settles suit with former Artscape officials At issue was $666,513 held by nonprofit festival group BALTIMORE CITY

April 23, 1993|By Joan Jacobson | Joan Jacobson,Staff Writer

After four years of bitter legal wrangling, former Artscape officials agreed Wednesday to turn over to Baltimore some of the money raised for the arts festival when Gov. William Donald Schaefer was mayor.

In settling a lawsuit filed by the city, the former Artscape officials agreed to turn over to the city 40 percent of the $666,513 that was raised for the summer event, in three annual installments of $88,868.

The settlement does not say when the city will get the rest of the funds. Under the agreement, the former Artscape officials will pay their legal fees with Artscape funds.

William A. McDaniel, lawyer for Baltimore Arts Festival Inc., said the nonprofit group's board of directors will decide when to turn over the rest of the money to the city.

Baltimore Arts Festival Inc. was set up during the administration of then-Mayor Schaefer to raise money for the event. When Mr. Schaefer became governor in 1987, leftover money raised for the festival was transferred to a second nonprofit group, the Maryland Community Foundation, set up by former Artscape officials.

The former officials have always claimed that Artscape was controlled by Baltimore Arts Festival Inc. and that they had the right to control the money.

The consent judgment detailing the settlement was signed Wednesday by Circuit Judge Joseph H. H. Kaplan.

Mayor Kurt L. Schmoke said yesterday that although Artscape donors "are going to be concerned about the use of their money" for lawyer's fees, he was pleased with the settlement.

Four years ago, he filed suit after the Baltimore Arts Festival, led by Jody Albright, who is now Governor Schaefer's arts adviser, refused to relinquish control of Artscape funds. After some legal skirmishes, the suit went to trial earlier this month.

Settlement talks began Monday, the day before the third day of the trial in Baltimore Circuit Court. Mr. Schaefer was scheduled to testify the next day under subpoena.

Mr. Schmoke said the settlement talks were initiated by Mrs. Albright's husband, lawyer David Albright, who contacted assistant city solicitor Burton H. Levin.

The mayor said he still doesn't know exactly why Mrs. Albright refused to turn over the funds for the festival since she has always agreed that the money can only be spent for Artscape.

Mr. Schmoke said he decided to settle the case rather than wait for a court decision or appeal.

"I wanted the money to get to Artscape during my term in office," he said.

AThe last five Artscape festivals since Mr. Schmoke took office in 1987 were financed with government funds, private donations, and grants totaling $160,000 from Mrs. Albright's group.

Yesterday, Mr. McDaniel released a sharply worded statement accusing the city of settling the case "because it could not prove its claims in court."

The statement called the city's claims "baseless," "wasteful" and "frivolous."

In response to Mr. McDaniel's statement, Mr. Schmoke said, "The tone of the statement really characterizes the mentality we've been dealing with over the last four years. This group has lost their battle in the court of public opinion a long time ago."

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