“It’s a leadership issue. This is what a leader does,” Rutter, who earns about $1.2 million annually, said in an interview Thursday. Kennedy Center Board Chairman David Rubenstein advised her not to, but she did it anyway.
“I need to be the first person,” Rutter said, alluding to the possible sacrifices that lie ahead. “My hope is that these circumstances don’t last forever, but I’m going to be a realist.”
Since the arts center closed March 12, it hasn’t paid about 725 hourly and part-time employees — including ushers, retail and concession workers — and it won’t compensate most of the artists who were booked for performances that have been canceled. The Kennedy Center remains shut until at least May 10; the next budget cuts will probably target some of its 670-member full-time staff.
It’s a common practice for highly compensated executives to reduce their pay when calamity strikes. Rutter follows Metropolitan Opera General Manager Peter Gelb, who announced March 19 that he was canceling the rest of the season and forgoing his $1.4 million salary until the world’s largest performing arts company returned to work.
For large organizations like these — with annual budgets of $270 million to $300 million — it’s more symbolic than financial, said Andrew Taylor, a professor of arts management at American University.
“There’s a symbolism and communications problem if you’re starting to inflict loss and suffering on your staff,” Taylor said. “If Peter Gelb or Deborah Rutter start to, and need to, lay off lots of people and calling the people they have contracts with and saying they going to invoke force majeure . . . it doesn’t look great or feel great if they’re not making a sacrifice themselves.”
It’s a different situation at smaller organizations, Taylor said, when cutting salaries will help with immediate cash flow. In those cases, it’s more likely that every salary will be reduced.
For example, the Massachusetts Museum of Contemporary Art in North Adams, Mass., had to lay off 120 of its 165 employees this week as the majority of its $12 million in revenue comes from attendance, concerts and other events. Museum director Joseph Thompson, who earns $300,000, said he would take a 28 percent pay cut. But with a mortgage and one child in college, Thompson said, he can’t afford to do what Rutter and Gelb have done.
“It shows real leadership, and I admire that,” he said of Rutter and Gelb. “Not everyone can do that.”
Rutter’s senior team is taking a 25 percent reduction in pay, a move she says they initiated.
The public announcement of Rutter’s pay cut came on the heels of the Kennedy Center receiving $25 million in the massive $2 trillion stimulus package that was awaiting a House vote after passing in the Senate on Wednesday. The money prompted outrage in conservative circles that do not approve of government support for culture. It also upset some arts leaders, who were dismayed by the size of the grant compared with the $75 million set aside for the National Endowment for the Arts.
Rutter was heartbroken by the criticism.
“It’s not a bailout,” she said. “We are different from any other arts organization [because] we have this responsibility as a memorial to John F. Kennedy.”
If the stimulus package is passed by the House and signed by President Trump, the funds will go toward the arts center’s $6 million in fixed monthly costs, Rutter said, including salaries and benefits and the cost of office and warehouse rentals. The money will not be used for artistic programming, nor will it go toward paying the ushers, artists and others who have lost income since March 12.
The arts center is selling some tickets for future performances, but it has had almost no income since the closure. Rutter said the federal money will replace lost income until reopening, whether that’s in May or July or later. Losses, she said, will exceed $55 million if the closure extends through Sept. 30, the end of the arts center’s fiscal year.
“Being a living memorial means you don’t just open the front door,” she said. “It will hopefully allow us to keep the personnel together to keep the organization going.”
Geoff Edgers contributed to this report.