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By JESSICA TOLEDANO

Staff Reporter

Less than a year after its acclaimed opening, the Getty Center is sharply scaling back.

One of the center’s four institutes is being shut down, and another is being cut or possibly merged into another. Two senior managers have resigned and layoffs are imminent, Getty Center officials confirmed.

Also being pursued are corporate sponsorships to generate revenues and reduce expenses.

“Some critics of the realignment are probably thinking, ‘They have all the money in the world, why are they cutting?’ ” said Barry Munitz, president and chief operating officer of the $8 billion Getty Trust.

“Not all of it was working so well. We don’t have all of the money in the world. We are re-examining what we are doing. Some of it could be done more efficiently and more cost-effectively. We need to face fiscal reality,” he said.

The Getty’s new fiscal reality includes a $300 million paper loss since July, the result of stock market declines. While Getty officials stressed that the market losses are unrelated to its large-scale restructuring, the losses are not being taken lightly.

“All of our budget is linked to the portfolio,” said Munitz. “We are being very careful. Our fate is not different from any other large endowment. It makes us a little bit nervous.”

The trust’s investment portfolio is currently valued at about $4.5 billion, down from $4.8 billion in early July. Its other assets include the $1 billion Getty Center, another museum in Malibu and a huge collection of art.

The center operates on an annual budget of about 4 percent of the endowment, or roughly $200 million. So the recent loss on Wall Street was $100 million more than the center’s annual budget.

“It definitely causes you to flinch,” said Stephen Rountree, executive vice president and chief operating officer for Getty Center. “We have gotten to a point where we are spending our entire budget. We have to look carefully at what we are doing.”

Orchestrating the downsizing, which does not include the new Getty Museum, is Munitz, former chancellor of the California State University system who took the helm of the Getty Trust in January.

Munitz has evaluated each of the Getty Center’s four institutes education, information, conservation and research to see where the center was duplicating its efforts and how the programs could be operated more efficiently.

Out of that evaluation came the decision to close the information institute, which is devoted to setting up databases, virtual libraries for the future and art-related Web sites. Some of the institute’s projects will be incorporated into other departments, but the majority of them will be discontinued.

In its place, the Getty Trust plans to give grants to technology companies better equipped to undertake those types of projects.

With the restructuring, two of the Getty Center’s senior managers have stepped down: Eleanor Fink, who headed up the information institute, and Leilani Duke, who ran the education institute. Fink is still working with Munitz as a part-time consultant. The education institute will also be scaled back and may be phased into another department altogether, according to Munitz.

Layoffs are also planned for the center in the next few months, but the number has not been determined. It will be the first time the center has laid off anyone, according to Rountree.

The other major initiative under Munitz is the pursuit of new revenue sources, besides the trust. Revenues from parking, the gift store and the restaurant are only a drop in the bucket compared to what the center spends.

Rountree said the Getty already accepts individual art donations and would not rule out taking large individual and corporate donations in the future.

“We are not an endless supply of money,” said Munitz. “We have to look at partnerships, leveraging resources and looking for corporate sponsors. We are not going to do everything by ourselves.”

The new fiscal restraint may be warranted, art professionals say, given the $1 billion cost of building the Getty Center and the huge amounts required to operate it. The Getty employs 1,400.

“They have very few ways of generating new income, and they are in a huge, expensive facility,” said Robert Ritchie, director of research for the Huntington Library, Art Collection and Botanical Gardens in Pasadena. “They have to make sure that they are secure. (The restructuring) is a sign that the center is maturing and possibly scaling back some of its earlier ambitions.”

The Getty Center was built from an outgrowth of a $1.2 billion gift from oil tycoon J. Paul Getty. The endowment’s investment portfolio grew from an estimated $2 billion in 1986 to $4.8 billion in July of this year. But then came the market downturn and $300 million paper loss.

“The value of the portfolio goes up and down daily,” said Rountree. “It doesn’t change our spending pattern for the future. If the market downturned for a decade, that would have an effect. But we are still very conservative about our annual spending.”

Nonetheless, those involved in charitable trusts and foundations say that no endowment, no matter how large, should consider itself immune to financial downturns.

“I don’t think any of us are so wealthy that $300 million isn’t a loss,” said Andrea Van de Kamp, chair of the Music Center Board of Governors. “The bottom line is a big concern. A charitable trust has a greater long-term interest. The Getty plays an important role on a worldwide basis. I think it is very smart to go conservative.”