DETROIT (WWJ/AP) – The Detroit Institute of Arts, which had a key role in the city’s bankruptcy case, is proposing bonuses and raises for three executives, including the recently retired chief executive whose loan on a six-bedroom home will also be forgiven.
The museum recently told local officials about $49,000 in raises for ex-director Graham Beal, and executives Annmarie Erickson and Robert Bowen, some retroactive, according to a report in The Detroit News.
While the overall compensation package comes to a total of $625,185 for all three, only $49,000 in taxpayer money will be used — with private donations from the general operating fund covering the rest. The three are also in line to get bonuses, but those will be paid with private money.
“With the bankruptcy, these three people had an inordinate amount of additional work to get us where we are today: testifying at the trial, working within the requirements of the court. It was a second job for all three of these people,” museum chairman Gene Gargaro told the newspaper.
During the city’s bankruptcy last year, there was intense pressure from creditors to force the sale of city-owned art. In the end, no art was sold. Instead, the museum, philanthropists and the state of Michigan came up with hundreds of millions of dollars to protect the art and soften pension cuts for Detroit retirees.
Beal, who retired as director on June 30, would get a $20,000 raise and a $30,000 performance bonus. The museum would also provide a $285,000 retirement severance, in addition to forgiving a $155,000 loan for his 6,000-square-foot home in Detroit’s Palmer Woods neighborhood.
The plan also calls for Erickson and Bowen to receive 3-percent raises each year for two years, and bonuses of $65,000 and $40,000, respectively, over two years.
Controversy always seems to arise when the DIA announces pay raises, especially since voters in 2012 approved a regional tax to support the museum.
Macomb County Commissioner Robert Mijac doesn’t object to the raises. But he questions the museum’s use of other money to cover the bonuses for Beal, Erickson and Bowen.
“If you can find private donations to support large bonuses, why can’t you find private donations to support the DIA without taxpayer support?” Mijac said.
Last November, Beal and Erickson repaid the museum $90,000 as reimbursement for bonuses awarded in 2013. At the time, museum Chairman Eugene Gargaro Jr. apologized for making “mistakes which we regret,” but emphasized there was “no wrongdoing of any kind.”
At the time, Gargaro defended six-figure salaries of Beal and Erickson, saying the compensation was based in part on personnel evaluations and the DIA’s financial performance.
Documents show that director Beal and Erickson each received $50,000 bonuses as well as double-digit pay increases in 2012 — Beal’s salary increased 13 percent to $514,000; Erickson’s increased 36 percent to $369,000. The increases came the same year voters in neighboring counties approved a yearly $23 million property tax millage to fund DIA operations for 10 years.
It was the second year in a row that Beal received a base salary raise, and the third consecutive raise for Erickson. Beal’s compensation has risen 20 percent since 2010, according to the documents, while Erickson’s has jumped 56 percent.
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