THE Los Angeles Theatre Center (latc), one of the largest and most innovative resident theaters in the United States, took its final curtain call Oct. 13. The four-theater complex had gained international acclaim for both multicultural productions and theater training programs targeted at specific ethnic groups.The theater opened in 1985 in a renovated downtown bank building in a high-crime area. It was to have been the linchpin in an urban renewal effort that never materialized. Despite its numerous financial woes and regular appeals for funds, the theater attracted an audience of 225,000 a year, 38 percent of which was nonwhite. "Particularly because of its gains in multicultural and nonmainstream programming, the demise of the LATC is a tremendous loss both to L. A. and the nation," says Barbara Janowitz, director of management services for Theatre Communications Group. In its short history more than 100 shows were mounted, and last year the theater won more Drama Critics awa rds than any other theater in the city. Al Nodal, director of L.A.'s Cultural Affairs Department, said a number of factors led to the theater's demise: a weak board of trustees couldn't meet funding goals, a "cry wolf" climate alienated supporters, and the recession. Noting that $27 million from the Community Redevelopment Agency (CRA) had supported the group for a decade, Mr. Nodal acknowledged the "high artistic vision" of LATC artistic director Bill Bushnell. But, Nodal adds, "the city gave them twice what we gave all other arts in L. A. combined and still it wasn't enough." Mr. Bushnell has been called both visionary and inept. The Los Angeles Times called his company "expensive, troublesome, egocentric, wayward, unruly, and essential." The Monitor spoke with him the day after the theater's closing. Thirteen resident theaters have collapsed since March 1989, and another six are in trouble. Is the theater's demise part of this larger downturn? I don't lay this at the feet of the recession or lack of audience support at all. I take some responsibility for not articulating clearly or forcefully enough to the powers that be why a multidiscipline, multicultural complex is essential to the identity of a city - especially this one. With one of the theater world's top paid attendances and critical acclaim, who needed to be convinced? In the largest sense of the word, the failure of LATC is a specific illustration of the failure of America to have any kind of coherent policy with regard to the arts. That has been reflected locally by no coherent leadership on the issue by the mayor, city council, and cultural affairs department. Those failings have a very specific impact on the attitudes of citizens and corporations when it comes time to give. Twenty-seven million dollars doesn't sound like a pittance. Eighteen million of that is sunk into the building which we still had to pay rent on ... $75,000 to $125,000 per month, which is what buried us. Was part of the problem the theater's poor location? We estimate our audiences at 20 percent short of what they would be if the city had executed its redevelopment plan as they told us.... It was five years before we had our own parking garage. Many feel that all involved saw the failure as someone else's fault. The mayor's own task force said we were one of the most efficient producers of theater in America and there was nothing wrong with the way we controlled money. The city didn't follow the [task force] recommendations. They bought the building but didn't provide for its fixed costs - janitors, utilities, guards, box office. What are the lessons? That it takes vision and support at the policy level from the beginning. From the artists point of view, the message is: Be careful in defining with government agencies what the public policy is toward the issues. I have also become dubious of mid-level corporate executives who sit on arts boards. That was all the rage in the '80s. The '90s has told me they were not qualified.