Bellevue museum says it needs quick cash

Bellevue Arts Museum officials told the City Council Monday night they need $2 million in city money to shore up their cash flow and continue rebuilding after a two-year closure.

Museum and city officials spoke face-to-face for the first time since it was discovered in May that the museum's chief financial officer was suspected of stealing $300,000 during her two years on the job. City officials had pledged $2 million to the museum last fall, but after the alleged embezzlement said they want to make sure the museum had the appropriate accounting controls in place.

Museum Board President Keith Baldwin told the City Council Monday that the museum has ramped up its fundraising, attendance and programs since reopening in June 2005. About 150,000 people have visited the museum, and the ArtsFair Patron Preview Party in July raised $350,000, he said.

The museum hired a forensic accountant to investigate the theft and has made several changes, including the addition of a four-person audit committee, an accounting procedures manual and policies for the museum's investments, Baldwin said.

"We will be a much more open organization," he said. "... We want people to understand our financial situation."

Council members asked only a couple of questions, and Mayor Grant Degginger said he was "happy to hear the museum has taken appropriate steps" to improve its accounting procedures.

The City Council will probably decide in the next few weeks whether to give the $2 million. Members of the city staff, including City Attorney Lori Riordan, are still looking over the museum's financial documents.

Baldwin said the museum wants the money relatively quickly because its cash flow decreases after summer, when the ArtsFair brings in a large chunk of the museum's income.

The chief financial officer suspected of the embezzlement has returned $10,000 to the museum "and we expect more," Baldwin said. What isn't recovered will be reimbursed by the museum's insurance company, he said.

Bellevue police have finished interviews and other research in their investigation of the theft, but the paperwork may not be completed for weeks because of a backlog of cases, spokesman Greg Grannis said.

The department would then send the results of the investigation to the King County Prosecutor's Office, which would decide whether to file charges.

Ashley Bach: 206-464-2567 or abach@seattletimes.com