Detroit Museum Defends Executive Salaries

October 23, 2014 Posted by Jessica Shofler in Employment Matters, News, Nonprofits

During a year in which the Detroit Institute of Arts Museum (DIA) campaigned for a property-tax increase to help with its shaky finances, it also awarded double-digit pay hikes to its top two executive staff. This is not sitting well in the suburban counties where voters approved the tax increase, which will result in $23 million to support the DIA.

The Institute’s executive director saw a pay increase of 13% to $514,000 and its chief operating officer saw a pay increase of 36% to $369,000. The Institute’s board chair, Gene Gargaro, explained away the COO increase, saying that her increase included retroactive payments as she worked several months at an old salary after being promoted to COO. Gargaro also stated that both officers had been paid less than the average for peers at comparable institutions and these increases were just bringing them up to be closer to that average. He stated, “I would not deny that the compensation they receive is significant, but I would also say that they’ve earned it.”

Rep. Eileen Kowall (R-White Lake) responded that “[t]his is money that should have gone toward protecting the city’s art, not lining the pockets of top officials at the DIA.” Not helping is that the DIA started collecting the tax money in January 2013 and the city filed for bankruptcy just 6 months later.

Gargaro pledged to “keep the elected officials in Macomb, Oakland and Wayne Counties informed on a current basis as we make executive compensation decisions in the future.” But Oakland County Commissioner David Woodward said that he would continue to push for greater public accountability and oversight of the DIA’s executive compensation given the voter-approved tax to fund the museum.

Do you think the raises were insensitive given the efforts made by the state government and the voters to support the museum?

NOTE: The information contained herein is not intended to be legal advice and the reader should know that no Attorney-Client relationship or privilege is formed by the posting or reading of this article which is also not intended to solicit business.

Casey Summar, Partner, The Law Firm for Non-Profits,1812 W Burbank Blvd, #7445, Burbank, CA 91506

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