Corcoran Gallery of Art Lays Off 18, Still Sees $3.5 Million Deficit

By Jacqueline Trescott
Washington Post Staff Writer
Friday, April 10, 2009

The Corcoran Gallery of Art announced yesterday that it is eliminating 18 positions from the museum and the Corcoran College of Art and Design's administration but still expects to end the fiscal year with a $3.5 million deficit.

The gallery, the city's oldest private museum, terminated four senior positions within the past two weeks, including its chief financial officer and its director of communications and marketing.

At a staff meeting yesterday, Paul Greenhalgh, the director and president of the two institutions, said 14 additional positions were being eliminated immediately. The firings represent 5.6 percent of the full- and part-time staff. Of the 18 positions, only two were part-time.

"We looked across the face of the whole organization. We were looking to have minimum impact on our core cultural business," Greenhalgh said in an interview. The layoffs represent an 11 percent reduction, $2.6 million, of its $24 million annual budget, and, along operational reductions, the immediate savings are estimated to be $500,000.

In other cost-saving steps, the Corcoran announced it will stop employer contributions to the workers' pension plan next month, and continue its hiring freeze, which began last fall. The Corcoran said it would save $520,000 by suspending its deposits into the pension plan. The fired employees are receiving a severance package, said Greenhalgh.

Like many arts institutions, the Corcoran is feeling the effects of the recession. Officials explained that the Corcoran's endowment has declined by 30 percent, its earned income has not met its projections, admissions are off, and sources of new money are scarce as corporations, individuals and foundations have cut back on their giving. "We totally understand that, but it reduces the places we can go to to get new support," said Sam Sweet, the chief operating officer. "No one has promised and not come through this year. It is the lack of new donors."

Sweet projected that by the end of the fiscal year, June 30, the Corcoran would have a deficit of $3.5 million.

Corcoran officials said the measures were taken instead of reducing hours or cutting salaries, and the decision was part of an ongoing strategic plan on how to run the two institutions more efficiently and reposition both as cultural leaders in Washington. "This is something we would have gotten to eventually," said Sweet.

In recent years, the Corcoran has confronted economic problems, some from carrying annual deficits, some from expensive shows that didn't produce the expected crowds. There have been a number of board and leadership changes. In 2005, the gallery decided to raise the admission and to close on Mondays, as well as the traditional Tuesday. It had hopes of building a grand expansion, designed by Frank O. Gehry, but failed to raise the $200 million for the project. The project was canceled in 2005.

This year, the gallery closed for six weeks to repair the roof and clean internal columns. Even before that, attendance was off. "Our earned income was not what we projected, down $600,000 from the fall. The [Richard] Avedon exhibit closed strong around the inaugural but the Washington audience in October and November did not come as projected," said Sweet.

From January to last week -- which includes the time it was closed -- 23,510 people visited the Corcoran. In the same period last year, which featured exhibitions of photographers Annie Leibovitz and Ansel Adams, 48,000 people came to the gallery.

This summer, officials announced, they will have free Saturdays, sponsored by a gift from the Morris and Gwendolyn Cafritz Foundation. The Corcoran, however, is looking at ways to cut back on the number of membership events and public programs in connection with exhibits, reduce its print advertising and increase its e-marketing, said Sweet.

At this point the college's faculty was not affected by the layoffs, but the Corcoran said all reappointments are being reviewed and some contracts might not be renewed.

The 18 terminated positions did not include any curators.

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