In May 2002 an agreement was executed between the Armenian government and the Cafesjian Family Foundation, according to which Gerard Cafesjian would sponsor and build the Cafesjian Museum [in Yerevan]. The deadline of finishing the construction was 2007. According to the agreement, during these five years the foundation would be exempted from all taxes. The government also gave 11 hectares of land surrounding the Cascade to the foundation. The [Tamanyan Park across the] Cascade was given to the museum for using purposes only. The Cascade and the 11 hectares of land surrounding the Cascade was government’s investment in the Cafesjian Museum project. The museum project was controlled by the Cafesjian Family Foundation, represented by the Vice President of the foundation John Waters. The foundation includes non-profit foundations as well as business entities (for instance, CS Media, Cascade Bank, etc.). Seven years have passed since the execution of this agreement but the museum is not built yet. Even more, now there are problems in this foundation and some people have been fired, including John Waters. According to our information, John Waters’ Deputy, Edward Balassanian, the head of the Center for Contemporary Experimental Art (CCEA) was also fired. However the latter told us that he had not been fired but has resigned by his own request and since March 2009. He has worked at the Cafesjian Museum Foundation from June 2002 until March 1, 2009.
– However you worked for the foundation until March 1, 2009, year 2009 is coming to an end but the museum has not been built as yet. Furthermore, there are persistent rumors and even exposés in the press accusing you, the President of Armenia TV Bagrat Sargsyan and the head of the foundation from the US John Waters. Even recently there were rumors that John Waters and Bagrat Sargsyan are simply bankrupting Gerard Cafesjian. Why did the implementation of the project fail if so much money was spent?
– I don’t want to discuss the innuendoes and rumors on people and I don’t want to waste time on it. This is all I have to say about John Waters and Bagrat Sargsyan activities. As for the suspension of the museum construction, there were two main reasons for it. The first reason was connected with the management of the foundation, as a result of which development of the project was let out of control. The second reason is that they made a project for Mr. Cafesjian which exceeded the intended cost by 3-4 times. According to Gerard Cafesjian’s plans, the budget of the museum would amount to 30 million dollars, but they presented a project amounting to 150 million.
– You can build more than five museums in Yerevan with 150 million dollars.
– Yes. It is really possible to build a museum with 20-30 million dollars as Mr. Cafesjian had planned initially. In 2002 he planned to spend 25 million for the museum, and another 5 million for reconstructing of the Cascade, which was given to him in a dilapidated and very poor condition. So the total budget was set at 30 million dollars.
– Didn’t they show the second version of the project to Mr. Cafesjian?
– The project was managed by John Waters. He was in charge of managing the architect and it was his fault. I was only in charge of construction works, i.e. they had to give me the project and I had to implement it.
– What were your official duties?
– I was not in charge of the design of the museum project. I was in charge of managing utilization of the entire complex and the routines of the foundation. I was in charge of reconstructing the Cascade (project design and construction) as well as construction of the new museum based on the project of the architect. As you know I completely renovated the Cascade. The museum is another story…
– Were you in charge of making the main budget of construction works?
– During seven years every month we presented financial accounting on how much money we received and spent on different parts of the project (more than 20 separate line-items), we also submitted the budget and calculations for the following month with the same details. However in the initial budget of 30 million they did not take into consideration the salaries and the operational expenses of the Cascade complex. According to my calculations, annually about 700 thousand dollar was spent on salaries. Every month we paid about 3-4 thousand dollars for electricity. I even cut down the expenses for electricity by installing laser lights on the escalators (which had to work continuously) in order to operate them whenever a person approaches. Otherwise we would have to pay 7-8 thousand dollars per month for electricity alone. I really received rundown and broken equipments. We repaired everything. The structure was leaking water all over. We had to remove the stone coverings and install waterproofing. We had to spend a lot of money on these works. I have all necessary documentation for these expenses.
You said that some people think I am guilty. Now I will present the list of the expenses, all of which are documented. In the period of June 2002 – March 2009 the expenses and investments of the Cafesjian museum foundation in Yerevan are as follows: salaries (annual salaries amounted to 700 thoousand dollars) – 4.900.000, current expenses, such as utility payments, public relations, etc. – 1.400.000 dollars, reconstruction, renovation and landscaping of the Cascade and Tamanyan Park – 11.800.000 dollars, museum construction – 4.800.000 dollars, advance purchase of metal and cement – 4.000.000 dollars, removal of real estate encumbrances – 3.000.000 dollars, other expenses – 2.900.000 dollars. It should be noted that the expenses of the Cafesjian Museum Foundation made in the United States are not included in this list.
Above mentioned expenses include construction of state of the art depositaries in the territory of “Hayfilm” [studios] to store the collection of Mr. Cafesjian in safe and proper climatic conditions. We have also built a big modern greenhouse in the territory of “Hayfilm” to cultivate the flowers to decorate the Tamanyan Park and surrounding areas of the Cascade. We used to spend about 20 thousand dollars every year to buy seeds for these flowers, which we would save since the greenhouse would produce several folds of what we would need ourselves. The excess would be sold in free market. By the way, Mr. Cafesjian appreciated and highly encouraged this initiative.
I should add that during the last two years senseless additional unnecessary works have been done at already renovated parts of the Cascade. In 2007 a new architect named David Hutson was hired, who destructed renovations I had made at the Tamanyan Park and the Cascade. He did redecoration of the exhibition halls. For example, changed the slanted ceilings to horizontal ones, installed frosted glass windows, etc. while renovation of all of the halls had been completed and they were ready for exhibitions. When I got this job, the exhibition halls did not even have windows. I installed new windows. However, the new architect replaced these windows and specified frosted glasses which were very expensive. Furthermore, the new architect decided to dig a big hole in the place of the museum because he wanted the basement of the museum to consist of two floors. According to the initial project, the building’s basement was supposed to be one floor. We spent so much money for digging this hole which was very disproportional in comparison with the initial budget of the building. We spent 4,629,000 dollars on the earthworks which included digging this hole. During digging the initial hole we met a thick layer of solid basalt stone. We had to spend a lot of money to dig this thick layer of stone. Any experienced architect knows that digging stone layers is more expensive than constructing a new building. As an architect I realized that in such a situation the work has to be stopped and the project needed to be revised accordingly, but we were forced to obey and agree with their decision without argument. Now this hole is fully built from the inside. What Hutson did was senseless. He presented a project which Mr. Cafesjian naturally could not agree with.
– What is the status of this process now?
– Mr. Cafesjian did not plan to spend 150 million dollars on the museum and he is right. I have heard that he will come to Yerevan in November. His visit has been delayed about 4-5 times. In one occasion he had even rented a plane and wanted to visit Armenia with several senators and high ranking officials to take part in the opening ceremony of the museum. But his visit was delayed several time as the architect was not able to provide drawings in time, as a result of which we were not able to finish the construction works. Now it seems that they are working on the Tamanyan Park, they have brought the statue of the Roman Gladiator to the park and have installed benches. They are trying to finish the works. I have also heard that they are planning to organize exhibitions in some of the halls of the Cascade.
– Will they be able to?
– I think they can finish the works fast if the quality of work is made secondary.
– Have you ever met Mr. Gerard Cafesjian?
– Once I met him in New York. We talked for about 2-3 hours. This conversation was not connected with the museum. I saw him in Yerevan several times too, but I did not have the opportunity to meet with him. My contact with him was only through J. Waters. There have been cases when I wrote letters about the situation and my expressed my concerns to Mr. Cafesjian, but I did not receive any answers from him. I sent the copies of these letters both to John Waters and Michael De Marsche (the executive director of the foundation since 2007).
I was especially concerned of the Center for Contemporary Experimental Art (CCEA). This was my second problem. When I was hired 7 years ago, my salary was three times less than the salary of a person of my qualifications in New York. I worked for seven years without salary increase. Three years ago I agreed with John Waters that if Mr. Cafesjian sponsored the CCEA, I would work until the end of my life without asking for salary increase. I made this agreement with J. John verbally without any document. But the situation and relations inside the foundation started worsening. I immediately informed Mr. Waters that I could not work with the architect any more. I also told him that if they thought I was an obstacle I could resign. He disagreed and said that they will take care of the problem. I continued to work. But 8 months before my final departure on March 1, 2009, they violated the agreement concerning the CCEA and stopped the financial support. Mr. Waters informed me with a mail that the reason of stopping the sponsorship was connected with the financial crisis and they would reinstate the support soon. Based on this promise I decided to use my family savings to pay for CCEA expenses as I believed they would return these funds, as promised. They have not paid 75.000 dollars for those eight months yet. I have no documents, thus I cannot sue them. But, even if I had a document I would not do that because Gerard Cafesjian is a great philanthropist and I would not insult him by doing so, even if they were not fair to me.
– Which documents did John Waters sign and which ones did Bagrat Sargsyan?
– Some areas surrounding the Cascade were encumbered upon by private parties. The transaction documents on purchasing these lands, houses and garages to remove the encumbrances were signed by Mr. Sargsyan and Mr. Waters.
– Why did not your letters reach Mr. Cafesjian?
– In December 2008 when I saw that the project of the museum was rather big and the situation was not good, I sent an action plan in a letter to Mr. Cafesjian and described what we had to do to get out of the situation. I wrote a timeline and informed that I would finish the museum and the Cascade works within three years at a budget determined by him, with the condition that I had to be in charge of managing the project. I addressed the letter to Mr. Cafesjian and sent the copies to Waters and De Marsche. I have never gone over people’s heads. We were told that the health condition of Mr. Cafesjian was not good and we were told not to write letters to him and inform that the situation was drastic in order not to put emotional pressure on him. Thus, apparently John did not pass this letter. Mr. De Marsche after this letter totally changed his attitude towards me. The person who used to tell me that they needed me, changed his attitude and even did not greet me or invite me to meetings. In February I told John about this situation and presented my resignation.
Eventually my letter reached Mr. Cafesjian. I suspected that John had not sent it to Mr. Cafesjian. I sent the same letter to Mr. Cafesjian’s adviser in April and mentioned in it that I it had been sent to him in December. They replied that they had not received any letter from me. Later the adviser informed me that Mr. Cafesjian had read the letter and appreciated my proposal. He asked me to stay in Yerevan in May in order to meet with Mr. Cafesjian’s new representative. When that person came, his mind was already poisoned. We talked for two hours and he eventually realized that there had been a conspiracy, and apologized to me several times.
They cannot accuse me of anything. I stand behind all of my signatures, except in two cases: One relates to the sale of reinforcement metal and the other is removal of land encumbrances, i.e. the transactions of buying the lands around the territory. Persons responsible for these transactions were Bagrat Sargsyan and John Waters. I did not have any participation in it. The other relates to the sale of the metal. The metal was sold by direct order of John Waters (I have the letter). When the project was ready, I asked the director of Haypetnakhagits (ArmStateProject) to provide the list of the metals necessary for the implementation of the project. We bought this metal from Ukraine by the approval of John Waters and paid 770 dollars per ton for it. We bought 4.800 tons of metal. It was not a risky decision because if we did not use a part of that metal we could sell it anyway. The fact is that when Mr. Cafesjian decided to make the project smaller, we had 3000 tones of additional metal, which we did not need anymore. Mr. Waters and Mr. De Marsche initially ordered us to sell the metal for not less than 1200 dollars per ton with the condition that the money had to be paid in cash. At that time we owed 2-3 million dollars to our contractors who asked us to give this metal at a little cheaper price which would also clear our debts. Some of them were prepared to pay up to 1000-1100 dollars per ton for this metal. In one week, however, we received a written instruction from Waters to sell the metal at 770 dollars per ton to the same intermediary company, through which we had imported the metal to Armenia from Ukraine. What could I do? I had no choice but to obey my superior’s order.
– Is the crisis the reason why Mr. Cafesjian controls his money now? According to our information, about two months ago he fired 180 people.
– It is really a very sad story. These people have worked for the foundation for many years with great care and diligence, and now they are faced with losing their only source of livelihood because of the crisis. This, probably is the most cruel, but inevitable outcome of capitalism…
I remember about three years ago Ross Vartian, the director of Cafesjian’s lobbying organization in Washington, said to me during a casual conversation that “When they show Mr. Cafesjian the spread-sheet of the funds spent on his projects, he will have a heart attack”. Mr. Cafesjian has invested a lot of money on “Hayfilm”, the museum, alternative energy research organization and other projects, which either do not function as they should, or are not completed as yet. I think such report has been sent to Mr. Cafesjian, and it is the reason why he made the above mentioned changes. I think it is not the end. There will be more serious developments. I am really sorry for these turn of the events. This unique and wonderful project is at the verge of collapse. It does not matter whether Balassanian will finish the project or someone else. The important thing is that huge investments have been made in the cultural sector in Armenia, which has to be supported and helped to bring them to a desirable conclusion. I say this with utmost sincerity and best wishes.