NEW YORK—This raises very serious issues about what is going on at MoMA [the Museum of Modern Art, New York],” Sen. Charles Grassley (R-Iowa) said in a statement to ARTnewsletter. “I plan to seek a detailed explanation from all parties: How much the head of a charity is being paid, and where those funds are coming from, should be crystal clear.”
Grassley, ranking member and former chairman of the Senate Finance Committee, was referring to aspects of compensation to MoMA director Glenn D. Lowry that were first reported in a Feb. 16 New York Times article by Stephanie Strom. According to the story, Lowry, who receives an annual salary, a bonus and benefits totaling $1.28 million, was paid an additional $5.35 million between 1995-2003 from a trust funded by three museum trustees and a nontrustee, the late Laurance Rockefeller.
The payments reportedly were made in various ways: When Lowry first came to MoMA in 1995, the museum made a down payment on an apartment for him, and the trust reimbursed him for his mortgage payments, the article reported. In 1999 the trust purchased the apartment from Lowry for the museum, and the director was given the $1.3 million profit from the sale.
However, Kim Mitchell, a spokeswoman for the museum, stated in an e-mail to ARTnewsletter that “payments from the trust were made at the request of the museum and in support of its activities.” These additional payments, which ceased in 2004, were part of the total compensation package stipulated in Lowry’s contract when he joined the museum, Mitchell contends.
The details of Lowry’s remuneration have emerged at a time when Grassley is conducting a review of tax-exempt organizations, aggressively targeting what he views as abuses by some nonprofits. Last November the senator sent a letter to MoMA chairman Robert B. Menschel requesting extensive documentation on the subject of fractional art donations (ANL, 1/17/06, p. 1) to the museum and an accounting of the compensation to MoMA’s five top-earning employees. Recently Grassley also turned his attention to the Smithsonian Institution, Washington, D.C., calling for a review of $90,000 in unauthorized expenses incurred by Smithsonian secretary Lawrence M. Small, found by an internal audit.
The New York Fine Arts Support Trust, which paid Lowry, was created by museum trustees Agnes Gund and David Rockefeller; it received additional financial support from Ronald S. Lauder, another trustee, and Laurance Rockefeller. A spokesman for David Rockefeller, Fraser P. Seitel, says that Rockefeller and Gund set up the trust in order to recruit Lowry, an Islamic art specialist who at the time was heading the Art Gallery of Ontario, but thought it unlikely that MoMA could attract him with a normal salary package. “They were determined to help in the situation because they were convinced he was the one,” Seitel told ARTnewsletter.
According to the Times story, payments made by the trust to Lowry and to Gary Garrels (a former MoMA curator who received $50,000 a year from 2000-02) were described in the trust’s tax forms as “charitable contributions.” (Garrels is now chief curator at the Armand Hammer Museum of Art and Cultural Center, Los Angeles.)
Last year the New York State attorney general’s office investigated the trust’s disbursements to Lowry and Garrels and expressed satisfaction with a one-page document that the museum filed in response, the Times story said.
According to a statement MoMA has given to ARTnewsletter, the article contained “a number of misleading assumptions” about the payments. “Lowry’s original contract with the museum was fully negotiated, disclosed and agreed upon by the executive committee of the board prior to Mr. Lowry’s appointment as MoMA’s director in 1995,” the statement reads. “The executive committee also approved the request for support for these obligations from the New York Fine Arts Support Trust. . . . All payments and compensation were fully reported on tax forms filed by the trust, the museum and Mr. Lowry, who paid income tax on all compensation he received.” MoMA spokeswoman Mitchell points out that Lowry listed the $1.3 million real estate profit as a capital gain, which is taxed at a significantly lower rate than income.
The Times article, according to MoMA’s statement, also “misstated key facts about Mr. Lowry’s support from the trust.” Lowry did not receive $5.35 million from the trust, it says, but $2.2 million plus the net proceeds of the apartment sale given to him “in lieu of a bonus that was part of his original contract.” Mitchell says that the trust, on behalf of the museum, paid Lowry $3.1 million for the apartment, of which he kept a net profit of an estimated $1.3 million. The balance was used to pay existing mortgage and closing costs, Mitchell explains. The museum kept the apartment as an asset (later it was sold).
A letter to the editor from Menschel and MoMA board president Marie-Josée Kravis, which appeared in the Times on March 3, stated that “all actions taken by the museum and the trust were legal, ethical and disclosed.” A Times spokesperson says the paper stands by its reporting.