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Met Debt: Museum Expects $8.4 Million Deficit for Fiscal 2009

“Jamie Houghton”—Met Chairman’s Signature

In a letter e-mailed last night to its members, the Metropolitan Museum’s board chairman, James Houghton, revealed that final audit results are expected to show an operating deficit that totals a whopping $8.4 million for the fiscal year that ended on June 30, 2009. This compares with a deficit of $3.2 million in fiscal 2008 and a SURPLUS of $2.6 million in fiscal 2007.

As Houghton’s letter indicates, this is not for lack of trying to cut costs:

A number of substantive cost-saving measures, including reducing staff [here and here—my links, not his]
by 14 percent through a combination of means, have greatly improved the
Museum’s financial outlook….Affecting this budget are revenue streams as well as endowment income.
Endowment income, which is averaged over a five-year period, has
traditionally provided approximately 30 percent of the Museum’s
operating income. Compared with the previous year, the long-term
endowment generated a negative return of nearly 20 percent for fiscal
2009. In addition, the Museum experienced a roughly 10 percent decline
in revenues from government support, private donations, Membership, and
ancillary activities (such as merchandising and restaurants).

Nonetheless, we have had encouragement on many fronts. Members, donors,
and funding entities have worked hard to maintain previous giving
levels and even to stretch their commitments. I am especially pleased
to note that the City of New York, which provides vital annual support
toward energy and direct operating expenses, had earlier projected cuts
of at least 25 percent, or $3.25 million, in fiscal year 2010. The city
now estimates that the Museum will receive only a 3 percent reduction
in operating support for the year, though, of course, this
appropriation is subject to continual review based on the city’s own
financial situation.

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