As I mentioned in my KCRW radio commentary, Jeffrey Deitch was hired as director of LA MOCA (effective June 1, 2010) to be a game-changer. It’s important to remember, though, that there was nothing wrong with MOCA’s curatorial game as it existed under previous director Jeremy Strick. MOCA’s exhibition program was already widely esteemed and shows organized by its curators regularly traveled to important venues.
It was the financial game that desperately needed changing. Deitch, a prominent New York dealer, was expected to parlay his impressive artworld contacts with the artworld’s movers and shakers into munificence for MOCA.
So how has Deitch actually performed as a financial game-changer? To find out, I made a formal request to LA MOCA (which promptly complied) for a copy of its Form 990 tax return and its financial statements for fiscal 2011 (to which I am unable to create a link). That was the first fiscal year of Deitch’s two-year tenure. (No accounting is yet available for fiscal 2012, which just ended on June 30.)
The most problematic figure is “zero”—the amount that MOCA raised in fiscal 2011 towards Eli Broad‘s offer of a $15-million match to contributions to the endowment, which was so depleted under Strick’s directorship that the California Attorney General’s office mounted an investigation (which resulted in a wrist-slap). Prior to Deitch’s arrival, $6.25 million has been raised towards Broad’s match.
A condition of Broad’s bailout (which also included $3 million a year for five years in exhibition support) was that the endowment be replenished. At the end of fiscal 2011, the endowment “deficiency” (as the draw-down is called), was $18.38 million. In a article for the LA Times last March, Mike Boehm reported that there was no further money raised towards the Broad match in the eight months following the close of fiscal 2011.
What this means is that $8.75 million from Broad is just sitting on the table, unclaimed by MOCA.
When I asked Michael Harrison, MOCA’s chief financial officer, why the replenishment of the endowment had stalled, he replied:
In fiscal year 2011, MOCA made a conservative, near-term decision to maintain maximum flexibility in its operations by keeping cash in reserve rather than increasing the endowment. The museum has paid $12.5 million [including the $6.25 million Broad match] to its endowment since 2008, it has a healthy cash balance, and no debt.
The endowment at the end of fiscal 2011 was $19.86 million, up from $18.59 million (largely due to investment gains) the previous year.
The other big eyebrow-raiser in the 2010 and 2011 tax returns relates to salaries: The documents reveal that chief curator Paul Schimmel‘s “reportable compensation” decreased from $256,259 in fiscal 2010 to $235,414 in fiscal 2011. In the same period, the director’s salary rose from $506,747 (Strick) to $648,281 (Deitch).
The tax return shows a slight operating surplus of $316,000 on a budget of $17.51 million. That surplus is considerably less than the $5.39-million surplus on the $15.88-million budget the previous year. The endowment has increased slightly—to $19.86 million in fiscal 2011 from $18.59 million the previous year—largely due to investment gains.
As a fundraiser, Deitch appears to have fallen short: Contributions and grants amounted to $14.59 million, down from $18.65 million in fiscal 2010 and $29.48 million in fiscal 2008. This may not be entirely Deitch’s fault: With the California Attorney General off their backs, the trustees’ sense of urgency about cleaning up the mess from the 2008 financial meltdown may have diminished.
As also reported by the LA Times’ Boehm last March, five key members of the financial team jumped ship during Deitch’s tenure: Gary Cypres, chair of the board’s finance committee, who had joined the board last summer; Fabrizio Bonanni, who had preceded Cypres as finance chair; David Galligan, chief operating officer; Sarah Sullivan, director of development; Richard Weil, chief financial officer.
What numbers can we expect for fiscal 2012, the year just ended? Although the formal reports aren’t in yet, most museums are able to say at the end of the fiscal year whether they ran a surplus or a deficit. When I asked Harrison whether MOCA’s ink was red or black, he replied:
The museum’s 2012/2013 financials are not public until the audited financial statement is completed for that period. We are still closing the books on 2012 and our audit will show the results. MOCA will end the 2012 fiscal year with healthy cash balances [not the same thing as an operating surplus] and no debt.
Moving into 2013, the museum has a conservative, balanced budget, and we are looking forward to a great year.
We can only hope.