After SFMOMA Cuts Salaries by 20%, Employees Call Out Major Loans Granted to Executives

The San Francisco Museum of Modern Art (SFMOMA) (Jeremy Thompson/Flickr)

SAN FRANCISCO — In the 2000s, the San Francisco Museum of Modern Art (SFMOMA) granted $1.3 million in home loans to staff in leadership positions. The museum’s board approved a reportedly interest-free $801,900 home loan for director Neal Benezra in 2002, followed by a $500,000 loan for former senior curator Gary Garrels in 2008. Now, labor union representatives and xSFMOMA, a group of former employees agitating for change at the museum, say these transactions symbolize the institutional inequity accented by recent layoffs and furloughs.  

On Friday, August 28, SFMOMA announced a 20% furlough for all staff, framing the cuts in an internal announcement as an “equitable” measure designed to avoid layoffs. It is the third round of cuts to devastate the museum this year. In an interview with Hyperallergic, Nat Naylor, SFMOMA’s representative with OPEIU Local 29, bristled at the idea that the cuts are equitable: a companywide percentage reduction cannot be fair — it hurts the lowest-paid workers the most.   

“A 20% cut to salaries that range from $400,000 to $20/hour is not equitable mathematically on its face,” Naylor said. “As the museum confronts very real financial strain as a result of not being able to open, one has to wonder about all of the money they’ve put forward in fringe benefits such as housing loans for Neal Benezra and Gary Garrels. […] For our members this cut can mean not making rent, and it’s just the right amount that they can’t qualify for unemployment.”  

Naylor added that the cut is a “slap in the face” to the dozens of employees who’ve been working onsite while the museum is closed to the public. She also said that the museum has not answered the union’s calls for hazard pay and travel compensation. “Some of our members have been basically losing money trying to get to work safely since April, during a pandemic and then with bad air quality,” Naylor said. “Now they’re being thanked with this 20% pay cut.”

The home loans resonate as symbols of institutional inequality because “ongoing increases in costs of housing and living have made the already expensive Bay Area more difficult for art workers,” xSFMOMA said in a statement to Hyperallergic. “SFMOMA, like many nonprofit institutions with billionaire boards, exists to generate and preserve wealth by exploiting the interests of the people it purposes to support and serve.”

Since the mid-2000s, while landlords systemically diminished rent-controlled housing, pay for many SFMOMA employees barely kept pace with the city’s minimum wage. But executive salaries multiplied, and the loans poised Benezra and Garrels to benefit from the real-estate boom threatening their employees’ future in San Francisco. xSFMOMA, in its statement, argued the loans show an institution that’s strayed from its aim to serve the public as a cultural resource. 

Benezra has led SFMOMA during a period of dramatic growth, not least a $305-million expansion to accommodate the modern art collection of Doris and Donald Fisher, billionaire founders of the Gap. On top of the wealth built through friendly financing on his home, Benezra’s earnings have grown threefold. SFMOMA’s 2018 tax filings show Benezra’s annual compensation exceeds $1 million.

Judging by wages, the vast majority of SFMOMA employees do not appear to have shared in the benefits of institutional growth.

Between 2004 and 2018, the hourly rate for frontline positions grew from $13.91 to $19.22, historic collective bargaining agreements show. In the same period, the minimum wage in San Francisco grew from $8.50 to $15 an hour. In other words, in 14 years the minimum wage rose 76% while the SFMOMA wage rose 38%. For most of this same timeframe, admissions and membership workers weren’t even SFMOMA’s lowest paid employees — in 2016, when San Francisco’s minimum wage reached $13 an hour, an SFMOMA coat-checker started at $13.72.

The $801,900 home loan that the SFMOMA board of trustees approved for Benezra was used to finance a $1.7 million Victorian two-story in the Eureka Valley neighborhood of San Francisco in 2002, public records show. SFMOMA declined to share the loan terms. A 2004 Chronicle of Philanthropy article calls it a 10-year, no-interest mortgage loan. In an example of SFMOMA smoothing Benezra’s home refinancing, the museum would also go on to subordinate its interest in the property to other future lenders in exchange for $1, public records show. One of the lenders was Charles Schwab Bank, whose namesake sits on the museum board. Today the house would fetch $3.5–$3.9 million, according to real-estate website Redfin. 

Benezra, in turn, offered a similar loan to recruit Garrels as senior curator, Garrels said at a staff meeting in June, according to two attendees. Public records show Garrels and his partner bought a house a half mile from Benezra for $1.6 million in 2008. At the meeting, Garrels said the $500,000 loan was necessary to cover his relocation from Los Angeles, where he was working as a curator at the Hammer Museum.

Garrels, who could not be reached for comment, resigned in July after invoking “reverse racism” while defending the importance of continuing to collect art white men. (He apologized for what he called his “extremely poor choice of words.”) It is not clear if he has begun to repay the home loan. SFMOMA’s most recently available tax filings from 2018 indicate he still owes $500,000.  

An SFMOMA spokesperson declined to make Benezra or other officials available for an interview. The spokesperson declined to provide a statement on the loans. Benezra accepted a 50% pay cut earlier this year, the spokesperson said. The 20% cut doesn’t apply to Benezra.

California law narrowly allows nonprofit public benefit corporations such as SFMOMA to issue loans to employees when financing a principal residence is necessary to secure their services, Arthur Rieman, managing partner at the Law Firm for Nonprofits, said in an interview. Like a bank or any other mortgage lender, the nonprofit should protect its interest in the money it lends. 

“No bank would issue a no-interest home loan,” Rieman said. “If I were advising a client that wanted to make a loan to an officer, I’d require the loan be at commercially reasonable terms.”

Some museum directors live in museum-owned housing, a perk with marked tax benefits. But home loans for what the Internal Revenue Service calls “interested persons” appear to be rare. 

On the most recent available tax filings, not one of the New York museums with the top 10 highest-paid executives reported an outstanding loan to an employee. Nor did any other art museum in the San Francisco Bay Area. (The San Francisco Symphony, however, has made “housing assistance” and “relocation assistance” loans to its director and principal bassist.)

Hyperallergic reviewed recent tax filings for more than 20 other art museums nationwide and found two with outstanding loans to employees. The Museum of Fine Arts, Boston’s board approved $150,000 and $200,000 loans for “bridge financing” on two former deputy directors’ home purchases. Gary Tinterow, director of the Museum of Fine Arts Houston, owes $784,261 on a board-approved $950,000 mortgage. Neither museum responded to comment requests.

Industry standards organization the American Alliance of Museums does not have a policy or guidelines regarding members issuing loans to employees, a spokesperson said in an email.

Many SFMOMA salaries have barely kept pace with the city’s minimum wage, while executive salaries have multiplied.Read MoreNews, California, Gary Garrels, Neal Benezra, San Francisco, San Francisco Museum of Modern Art, SFMOMA, xSFMOMAHyperallergicRead More

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