In her recent NY Times piece, Robin Pogrebin provided an upbeat assessment of the Metropolitan Museum’s financial progress, as conveyed to her by president and CEO Daniel Weiss in a wide-ranging interview. Arriving as president in July 2015 with a mandate to clean up the Met Mess, Weiss expanded his portfolio after the departure of director Tom Campbell, who had left the place in financial disarray.
Photo by Lee Rosenbaum
But a close look at the financials in the Met’s recently published Annual Report for fiscal 2017 (ended June 30) suggests that it’s premature to add “Turnaround King” to Weiss’ titles. The realization of the museum’s “Financial Transformation Plan” still has a long, bumpy way to go.
Pogrebin’s news peg was the Met’s $80-million windfall from its longtime benefactors, Florence Irving and her late husband Herbert. But I doubt their munificence had anything to do with “a new level of donor confidence,” as Pogrebin suggests in her first sentence. Coming from the donors’ family trust, the gift was “triggered by the passing of Mr. Irving,” a museum spokesperson told me. (The co-founder of Sysco Corporation, 98, died in October 2016.) It would appear that this benefaction was the fulfillment of old commitments, not a result of “new donor confidence.”
The museum’s galleries for South and Southeast Asian Art were named for the Irvings in 1994, and its Asian Wing in 2004:
According to the Report of the Chief Financial Officer, Jameson Kelleher, the museum is projecting “strong revenue growth over the next few years,” thanks to “multiyear plans” in “visitorship, membership retail, restaurants and special events.” Nevertheless, the budget is expected to remain in the red until fiscal 2020. That’s a two-year delay from the FY16 projection of a balanced budget in 2018.
Trying to make a positive out of a negative, the museum reports that its FY17 operating deficit “was contained to $10.1 million.” This was worse than the $8.26 million deficit reported in the FY16 Annual Report, but not as bad as the $15 million that had been projected. There’s cause for cautious optimism in the impressive “14.1% endowment returns and a record fundraising year”—some $232.2 million in philanthropic gifts, compared to the previous year’s $214 million.
Weiss has stated that the museum’s deficit-driven cutbacks would not be noticeable to visitors. But most striking among the expense reductions was the huge decrease in the budget for special exhibitions—from $22.03 million in FY16 to $12.68 million in FY17. (Although not citing these figures, Pogrebin did report that the number of special exhibitions had dropped from 60 to 45.)
UPDATE: To clarify the reduction in the special exhibition budget, Kenneth Weine, the Met’s chief communications officer, cited a passage in the CFO’s report stating that “cost control over large-scale exhibitions” had reduced the FY17 exhibition expenses (by $3 million from the previous year, Weine told me). Ken added that “a one-time reduction” of roughly $6 million had resulted from assigning an exhibition’s closing costs to the year in which the closing actually closed, rather than the year when the show had opened.
Happily, the Met has still managed to pull off its bravura Michelangelo drawings show (now on view), worthy of comparison with any display in its heyday. (More on that in a future post.)
Photo by Lee Rosenbaum
The annual report provides new insights into the downsizing of staff: The Met spent some $10.8 million in FY17 on “restructuring costs,” in connection with voluntary retirements (with buyouts) and involuntary layoffs. These staff cuts “affected 106 employees.”
The museum had previously refused to release the names of the 57 employees who accepted voluntary buyouts as part of the its cost-cutting initiative. But retirees are now identified in the “Staff” section of the FY17 annual report. Among them are key professionals, including: Denise Patry Leidy, curator of Chinese Art, Asian Art; Dieter Arnold, curator, Egyptian art; Kay Bearman, senior research consultant, Modern and Contemporary Art; Florica Zaharia, conservator in charge, Textile Conservation.
Here’s the loss that I particularly rue—Joan Aruz, curator in charge, Ancient Near Eastern Art:
Photo by Lee Rosenbaum
The department of Medieval Art and The Cloisters took a big hit, losing three key curators to retirement: Peter Barnet, senior curator (who in 2013 had been replaced as curator in charge of that department by C. Griffith Mann, who remains); Charles Little, curator; Timothy Husband, curator. Weiss himself is a medievalist. Might he be planning to fill in? (Just kidding.)
Particularly depleted by layoffs was the Digital Department—a key priority of ex-director Tom Campbell: Many FY16 staffers have disappeared from the FY17 roster. Adding insult to injury, the list of those remaining in that department has been bumped from the first page of the FY16 staff section to the fourth page in FY17. (I have previously written about the Met’s apparent rethinking of digital.)
Regarding the attempt to improve earned income, Pogrebin’s report states that “the once money-losing retail operations…are now breaking even.” But the FY17 annual report tells a different story: Revenues from retail operations ($56.08 million) were exceeded by operating costs and expenses ($57.99 million). That said, FY17’s retail costs and expenses included “$2 million of one-time charges pertaining to the voluntary retirement program, other severance costs and a new e-commerce system.”
Perhaps the most striking indicator of sluggish sales (and overstocking) was the remaindering of Campbell’s “Tapestry in the Baroque Threads of Splendor.” The catalogue for the ex-director’s acclaimed 2007 exhibition (list price: $75) could be found on the bottom shelf of the bargain-priced books, below.
Aside from the financial uncertainties, several major questions about future prospects loom over the Met. More on those soon.
CORRECTION: In a previous version of this post, I erroneously stated that Weiss was the Met’s president, CEO and director. As I had previously written, technically there is no director—only two deputy directors, “providing strong and productive leadership of the Director’s Office.”
The search for a new director continues…