Clough, Installed as Smithsonian's Secretary, Announces Cost-Cutting Measures
Tuesday, January 27, 2009
The newly installed secretary of the Smithsonian Institution announced yesterday that he has implemented a hiring freeze and eliminated salary increases and bonuses for one class of its highest-paid employees. G. Wayne Clough has also asked several departments to reduce their current-year budgets by 5 percent to 8 percent.
The action, taken because of the decrease in the Smithsonian's endowment by 25 percent last year and the uncertain economic future, follows a similar hiring ban, started last October, in the ranks of employees who are paid by the federal government. The Smithsonian, the largest museum and research complex in the world, is financed through private money and public appropriations from Congress. Public funds account for 70 percent of its $1 billion annual budget.
"We are concerned about our financial situation," said Clough, who after six months on the job was officially installed yesterday as the 12th secretary of the Smithsonian. The freezes went into effect Jan. 16, and involve 67 staff members paid by private funds rather than taxpayer dollars. The departments asked to reduce their budgets are not federally financed and include the central development office. They do not include the museums.
At a briefing after the ceremony, the regents reported on both the somber and optimistic sides of the Smithsonian finances. Roger Sant, the outgoing chairman of the Smithsonian Board of Regents, said the endowment is now worth $783 million, down slightly more than 25 percent from last year. "This is a very tough time," Sant said.
The administrators, however, outlined what they saw as encouraging moves. The U.S. House version of the stimulus package under consideration on Capitol Hill includes $150 million for the Smithsonian. "We would use that to support new jobs," Clough said. He also said he envisioned putting $75 million into the restoration of the Arts and Industries Building -- shuttered for the past five years and an eyesore that irritates Congress and the public -- as well as energy-saving projects.
Clough's installation, at the National Museum of the American Indian, was also a sign of the times, marked by tradition but scaled back from previous lavish investitures. There was a procession of 20 people in full academic garb representing the research and cultural areas of the Smithsonian, and Clough received a key to the Castle, the landmark administration building, from Chief Justice John G. Roberts Jr., the Smithsonian's chancellor.
The symbolic gift of a key provided a light moment for Roberts. The key tradition started in 1964, replacing the administering of an oath of office. Roberts, who famously flubbed when swearing in President Obama last week, smiled as he said: "I don't know who is responsible for that decision, but I like 'em." The 300 people sitting and dozens leaning over the balconies in the museum's grand atrium applauded.
Clough, 67, stepped into the secretary post in July, after 14 years as president of the Georgia Institute of Technology. His selection by the regents was interpreted as a new beginning after a scandal over extravagant spending drove the previous secretary out of office. Besides serious questions about management, the Smithsonian was also probed about the high salaries of its business-unit executives, the travel of the then-director of the American Indian museum and outside appointments of its top administrators.
In the interim, under Cristián Samper, the director of the National Museum of Natural History, the regents and administrators changed the executive salary levels to match counterparts in the federal system, and devised a series of reforms to their oversight of the sprawling institution. Clough, a civil engineer, is seen as an experienced manager of a large institution, with a fundraising record at Georgia Tech of $1.5 billion in private gifts, and a broad understanding of interdisciplinary programs. He is overseeing a strategic plan for the 162-year-old museum complex and a major capital campaign, part of which will address the $2.5 billion backlog in repairs.
Speaking to the employees and guests, Clough called for a renewal of the Smithsonian: "To be successful, we must be innovative, disciplined, focused, nimble and more self-reliant than in the past."
In other business, the regents moved Patricia Q. Stonesifer from chair-elect to chair of the 17-member governing body. A former chief executive of the Bill and Melinda Gates Foundation, Stonesifer was elected in September.
During their morning session, the regents approved a new directive about compliance with the Freedom of Information Act. They restated that, although the Smithsonian is not an executive branch agency, they will follow some of the federal government's guidelines for information requests. Yet, citing their need to raise money and develop earned-income projects, the regents said they would not fill any requests that asked for Smithsonian investments or financial information and donors' personal and financial data.
Sen. Chuck Grassley (R-Iowa), a frequent critic of the Smithsonian's disclosure policies said of the announcement, "It raises some concerns to see a policy that adds further exemptions" to compliance with the public-information law.