The Shaky Finances Behind the Met’s Admission Fee Increase

Harold Holzer, Metropolitan Museum's senior vice president for external affairs

What exactly is the "economic necessity" that the Metropolitan Museum says is behind its recently announced admission-fee increase?

Harold Holzer, the Met's senior vice president for external affairs, told me today that, unlike fiscal 2010, when the Met had an operating surplus of $3.7 million, the museum expects to run a deficit of about $2 million in fiscal 2011, ending June 30.

Fiscal 2012 is expected to be even more challenging: Operating overhead will increase with the opening of the new galleries for art of the Arab Lands, Turkey, Iran, Central Asia, and Later South Asia in November; and American art in January.

What's more, the impact of the economic downturn of 2008 and 2009 will strongly reverberate next year, because the Met determines how much money it can withdraw from its endowment by taking a percentage of the average value of its endowment over the previous five-year period. This cushions the blow when a big downturn hits, but spreads the pain into subsequent years.

"For the first time since 2008, when the market took its big downturn," Holzer told me, "we are now finding, for the next year or two, that income [applied to operations] from the endowment [because of the recessionary impact] is not going to rise as it does every other year. That's a major change." Government support, Holzer also noted, has "fallen precipitously."

Similar problems are likely to be experienced by the many museums around the country that use a five-year (or four-year) averaging rule to determine how much money they can withdraw in a given year from the endowment to fund operations.

Responding to those who have characterized the Met's ticket sellers as unwelcoming to those who don't cough up the entire suggested admission fee (rising to $25 on July 1), Harold assured me these gatekeepers are actually "extremely well-trained, extremely nice and extremely efficient."

Take that, Randy and Emma!