ggopher posted on January 12, 2010 12:17
We were intrigued by a story posted in today's New York Times "Artists Miffed Over Rothschild Foundation’s Missing Grant Money".
This story describes how The Judith Rothschild Foundation awarded 17 grants totalling over $100,000 in March 2009, but has not actually send the funds to the grantees. The mystery deepens as the grantee organizations began attempting to contact the foundation, only to be met with an unanswered telephone number, bounced emails and returned letters.
Some grantees reported that they had received a letter of apology from the foundation's sole trustee, Harvey Shipley Miller, stating “Unfortunately, in the last quarter of the year I suffered a serious accident and have been unable to finish all of the business pending in 2009, including the cutting and posting of the grant checks.”
We looked over their 2007 tax return, and were surprised to see that Mr. Miller is listed as the sole trustee. He is listed as working 98 hours per week, with no compensation. Additionally, while the foundation has sizeable assets, in 2007, their liquid assets only amounted to about $250,000.
In looking back over the 2006 and 2005 returns, the liquid assets were slightly less so that seemed to be the historical norm, at least for the past few years. What was very interesting is that in 2005, there were three foundation employees listed as earning over $50,000 per year, as well as Mr. Miller earning a substantial salary. In 2006, there were two employees listed, and Mr. Miller again earned a substantial salary. Then in 2007, no employees were listed and Mr. Miller was reported as earning no compensation. Did the foundation reduce employee hours and wages in accordance with the sliding economy or were those funds put to use elsewhere?
Interviews indicate that there were large expenditures to acquire approximately 2,500 works by unknown artists. If that is the case, those purchases seems to run counter to the intent of the foundation's mission.
We wonder what the ramifications are, if any, of defaulting on the grant agreements made. The Times article indicates that the Attorney General office has been contacted. In any case, there are enough liquid assets to pay the grants, and in an interview (as reported in the Wall Street Journal online), Mr. Miller states that the grants will be paid within 30 days. The larger questions are, what is the future of The Judith Rothschild Foundation, and what are the benefits vs. the problems with utilizing a sole trustee?
Here is a link to an interesting 2005 article about Mr. Miller: http://nymag.com/nymetro/news/people/columns/intelligencer/9500/