Healdsburg's beloved Villa Chanticleer has been run by the city for more than a half-century, but steady losses are prompting plans to lease it to an outside operator.

The City Council agreed this week that it makes sense to start crafting a plan to solicit proposals from private entities interested in running the Villa.

The idea is to outsource operation of the Villa as a high-end special-event venue, but also keep it as a community gathering place.

"This is a community treasure. It's an important part of the community and the history of Healdsburg," said Jay Tripathi, who chaired a city subcommittee to review the Villa operation and make recommendations on how to make it profitable.

Since 2008, the city has lost $513,000 running the Villa, averaging more than $102,000 annually.

Officials acknowledge the city is not best suited to operate it as both a community center and a special-event venue without running up a deficit. Redevelopment money has been used to cover the gap, but those funds evaporated when the state eliminated redevelopment agencies.

City officials believe a private entity could manage multiple events simultaneously in each of the several distinct areas of the Villa. Also, an independent operator could still offer preferred pricing for residents and local nonprofit groups, preserving their historical annual event dates at the Villa.

That's of particular concern to American Legion members, who showed up at Monday's council meeting to emphasize their longtime association with the Villa. They hold the liquor license at the Villa and also use an annex for their meetings.

"It's not our intention in any way to push the veterans out," said City Councilman Jim Wood. "We respect the Legion and everything they've done there."

Wood also said the city needs to respect the concerns of dog lovers, who want assurances the adjacent dog park on city property won't be relocated.

The 6,000-square-foot Villa was established as an exclusive French family resort until it was taken over by gamblers in the 1940s. It sat empty until the late 1950s, when the city took it over as a community center and park.

Kent Mitchell, a former mayor who has served on various panels over the past 25 years that have analyzed Villa operations, said it's "a fabulous facility."

Residents love it like they do the Healdsburg Plaza and Recreation Park, he said.

"We all have used the Villa," said Mitchell, noting it's used for school proms and celebrations, fundraisers, marriages and memorial gatherings.

"We are stewards of the Villa. Just as important, we are patrons of the Villa," he said.

He said there is precedent for the city to turn over operations of a facility for an outside party to run. The Tayman Golf course, he noted, was losing large amounts of money until it was leased to a private operator that "does a great job."

The subcommittee Mitchell sat on determined a private entity would have greater flexibility for generating revenue that could be set aside for needed capital improvements at the Villa and deferred maintenance.

"We don't want our great-great-grandchildren to go up and look at the Villa ruins," said Mayor Gary Plass.