Copia: The American Center for Wine, Food, and the Arts said Monday it has "temporarily" suspended operations at its $78 million Napa campus and sent its employees home while it tries to complete the final stages of a "significant debt restructuring."

The move comes 15 months after a bank run by the state approved a Wall Street-led refinancing of existing Copia debt even though, a Bee investigation found, the nonprofit organization was insolvent and facing $225,000 in penalties for breaching federal tax rules.

Garry McGuire, Copia's interim chief executive, said in a statement that he is working on another debt restructuring for the center that "will allow it to continue to serve its food-and-wine education mission."

"The current economic crisis has made it difficult to obtain capital and applied additional pressure to our financial turn-around announced earlier this year," McGuire's statement said.

Hired by Copia's board of trustees in March to improve the center's financial results, McGuire said announcements about Copia's plans will come after Thanksgiving.

Sharon Boorstin, Copia's Los Angeles-based publicist, said the restructuring under consideration involves plans by Copia to sell its Napa complex and use the proceeds to pay down its debt, while possibly leasing back space from its new owner.

"It's the whole turnaround thing," she said.

McGuire was quoted Monday on the wine Website Decanter.com as saying the Copia "should reopen" Monday. But the closure on Friday took even the center's employees by surprise; they were told to take their personal belongings home.

Visitors expecting to take in a cooking class or see a movie over the weekend were greeted with a paper sign taped to Copia's front door: "Copia is temporarily closed. Please visit our Website at copia.org for updates and information."

On Monday, the Web site offered no update or information on the closing.

Named for the Roman goddess of abundance, Copia is an 80,000-square-foot shrine to wine and food on the banks of the Napa River. It was the brainchild of the late Napa wine mogul Robert Mondavi, who donated $20 million and the land on which it was built.

Since opening in 2001, it has lost between $4.2 million and $12 million a year and had accumulated a $14 million deficit, according to a 2007 annual report prepared by accountants Pisenti & Brinker.

Forecasts originally called for a paid attendance of between 467,900 and 522,400 a year by 2006. But it instead topped out at 146,472, and the center has since stopped charging admission in an effort to boost traffic to its restaurants, wine tastings and gift shop.

Dave Landis, 40, a longtime Napa resident and wine broker, believes Copia has been a tough sell for tourists who prefer to get a wine education at the valley's wineries instead of stopping in downtown Napa.

But Landis believes Copia has been an important part of downtown Napa's revitalization, which includes the recent opening of the nearby Westin Verasa condominium-hotel.

"Everyone hopes that the closure of Copia will be temporary. Copia was ahead of its time for downtown Napa, and it's integral to the backbone of downtown," Landis said.

Copia has an interest payment due to its bondholders next month. Investors who bought the tax-exempt bonds are worried by the abrupt suspension of operations, said Michael De Luca, a Carlsbad-based bond trader.

"This is a major, to be continued, story," De Luca said. "But this is pretty ugly, to say the least."

Copia bonds, issued after they were approved by the California Infrastructure and Economic Development Bank – known as the I-Bank – are now trading for less than half their $100 face value in the bond market.

What happens next will depend on Copia's restructuring plan, its bondholders, the bond trustee and a New York-based bond insurer that has pledged to refund bondholders if the wine nonprofit goes bankrupt.

The state says taxpayers aren't on the hook if Copia collapses, but officials could be drawn into an expensive legal battle if bondholders don't get their money back and decide to sue.

Spokesmen for JP Morgan Chase, the investment dealer that issued new bonds in 2007 after refinancing and increasing Copia's original bond debt, and the Bank of New York Mellon, the bond trustee, had no immediate comment.

Bond insurer ACA Financial Guaranty Corp. did not return messages.

Call The Bee's Andrew McIntosh, (916) 321-1215.