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Thursday, July 3, 2014 12:01 am

Foundation to play role in governance controversy

Critics question influence on institution

PHOTO BY DAVID CARSON/MCT
Representatives from the Abraham Lincoln Presidential Library Foundation are expected to be part of a panel created to review governance issues at the institution.

 

A struggle for control of the Abraham Lincoln Presidential Library and Museum isn’t just a matter of the Illinois Historic Preservation Agency, which now calls the shots, versus the institution’s advisory board, which can only make recommendations.

Square in the mix is the Abraham Lincoln Presidential Library Foundation, the institution’s nonprofit fundraising arm. From finances to exhibits to questions about governance, the foundation is a big-money player that boasts a payroll exceeding $900,000 and has on its board such VIPs as Julie Cellini, former Gov. Jim Edgar and Sergio “Satch” Pecori, who is president and CEO of Hanson Professional Services. With a compensation package exceeding $250,000 for the fiscal year that ended a year ago, CEO Carla Knorowski made $100,000 more than the ALPLM’s executive director. She was granted a raise of more than $60,000 from the previous fiscal year.

The foundation’s influence is evidenced by the IHPA board’s recent move to include representatives of the nonprofit on a panel to review governance issues raised after House Speaker Michael Madigan tried to remove ALPLM from the historic preservation agency and give control to the institution’s advisory board. Under the governance review plan, which has not yet been formally approved by the IHPA board of trustees, the foundation, the IHPA and the advisory board would each have two representatives on the panel, which would also include three people not associated with any of the three groups.

The foundation has not adopted a position on governance issues, but it’s a stacked deck, so far as Patrick Reardon, an advisory board member, is concerned. He calls the agency review plan “a sham and a whitewash.”

“They’re (the foundation is) tied in with the IHPA,” says Reardon, a retired Chicago Tribune journalist. “It’s my understanding that the foundation decides what it’s going to raise money for – the foundation decides what the library and museum needs, which seems sort of odd. … To some extent, it is a case of the tail wagging the dog, in the sense that the foundation seems to determine its own agenda.”

One example of the foundation setting the agenda, Reardon says, is the Taper collection, a stockpile of 1,500 Lincoln artifacts that the foundation purchased for $23 million in borrowed money in 2007. The foundation, which still owes more than $11 million, paid nearly $520,000 in interest during fiscal year 2012 that ended in June 2013 (the most recent year that financial records are available) while reducing the principal by $750,000. Previously, the foundation had reduced the principal by as much as $4 million in a single year.

Knorowski said that the foundation purchased the Taper collection on behalf of and at the request of the museum and the IHPA. In an email, she described the foundation, the museum and the IHPA as a “triumvirate that works together for the good of the Abraham Lincoln Presidential Library and Museum.”

The most recent available financial figures show that the foundation brought in nearly $5.3 million in the fiscal year that ended in June of 2013 and provided less than $850,000 in direct support of ALPLM operations. Direct support money came from revenue generated at the museum gift store, a Subway sandwich shop in the institution and from caterers, all of which have contracts with the foundation, as well as from foundation memberships purchased at the museum that include admission to the museum.

The foundation has established a committee to help verify the provenance of a hat believed to have belonged to Lincoln.
Another $990,000 in grant money given for specific purposes such as digitizing documents was distributed and nearly $300,000 was spent on special events, such as the foundation’s annual Lincoln Leadership Prize award ceremony in Chicago, where former president Bill Clinton was honored in 2013 (director Steven Spielberg won the prize this year). After two years of deficits, more than $1 million in 2010 and more than $3.1 million in 2011, the foundation had a surplus of more than $1.2 million in the fiscal year that ended a year ago.

Available financial records show that the foundation’s direct support of ALPLM operations fell slightly in three successive years, from $871,000 in fiscal year 2010 to $840,217 in the fiscal year ending in June, 2013. During the same time frame, the foundation, which has a 10-member staff, saw its payroll grow from $730,900 to $931,450. The foundation’s revenue increased during that time so that it brought in $2.2 million more in fiscal year 2013 than two years earlier.

Foundation chairman Wayne Whalen did not provide an answer when asked why the foundation’s payroll has increased while direct support for museum operations has decreased.

“I can’t speak to that,” Whalen said.

Whalen declined to say why Knorowski was worth more than $250,000 a year or why she was given a $60,000 raise between fiscal year 2011 and fiscal year 2012, which ended a year ago. Knorowski, who granted an initial interview but did not answer a subsequent email, could not be reached to speak about her salary.

Principal and interest on the Taper loan have been the foundation’s largest expense in recent years. Craig Schermerhorn, the foundation’s treasurer, said that paying the debt has been a struggle. The note comes due in 2017, and refinancing is a possibility.

“We expected to have it paid off two or three years ago,” Schermerhorn said. “We said (to IHPA before the purchase) ‘OK, do you want Taper? If you want the Taper collection, which is deal-changing for the museum, recognize that there is a cost to it.’ … Our war is paying off Taper at this time. It’s a long-term battle.”

Steve Beckett, chairman of the advisory board and author of a bill that would remove the institution from the IHPA and give control to his board, says that the foundation’s work has been “remarkable,” but he fears that the Taper collection has eclipsed other important matters. He notes that the library is supposed to serve as the state’s historical library and so must concern itself with non-Lincoln history.

“I was shocked when I heard about the cost of the Taper collection,” Beckett says. “If all of your fundraising is about a particular Lincoln collection, then you lose sight of the broader focus and the goals of the Illinois library. It can’t be all one or all the other. It can be both. And it needs to be both.”

Reardon isn’t the only one who has concerns about ties between the foundation and the IHPA. Questions about the relationship date to at least 2010, when the American Association of Museums (now called the American Alliance of Museums) issued a report outlining challenges to accrediting the institution. The AAM found blurred lines of responsibility and potential conflicts of interest. Some potential conflict-of-interest concerns spawned by two foundation members who also sat on the IHPA board were settled when Gov. Pat Quinn replaced Cellini and Ed Genson on the IHPA board. The first two ALPLM executive directors were also directors of the foundation, an arrangement that AAM evaluators found troubling, but that practice ended when Eileen Mackevich, the current ALPLM director, was hired in 2011. She sits on the foundation board but cannot vote.

But the status quo remains in some areas.

The AAM, for example, suggested that the foundation tweak its mission statement so that it does not say that the foundation acquires artifacts – such a statement has the potential to undermine the institution’s role, the AAM determined. The AAM suggested that the statement be altered so that it says the foundation “supports” the acquisition of artifacts. But the foundation is still in the acquisition business, according to its mission statement.

The foundation’s staff includes a historian, which puzzles Tony Leone, a former IHPA board member and critic of the foundation.

“They have their own historian?” asks Leone, sounding shocked. “They have a number of people that those salaries could go to help the salaries at the museum. … That is a terrible waste.”

Whalen defends Ian Hunt, the foundation’s historian.

“I’m a very strong supporter of Ian Hunt,” Whalen says. “He knows history.”

Noting that the museum is short-staffed and lacks a state historian to oversee the institution’s research and collections division, Knorowski says that Hunt helps out with tours, research and work overflow. He also conducts research for articles published in the foundation’s magazine and assists with donor events and inquiries from members, Knorowski says.

“We have a historian on staff because we, like the ALPLM and the IHPA, are an institution which serves history – namely Lincoln history,” Knorowski wrote in an email. “It makes sense to have a historian on staff who is an expert in our area of focus. There is little dispute that the ALPLM’s historians already have their plates full.”

Two years ago, when inconsistencies surfaced about the provenance of a hat supposedly owned by Lincoln that is part of the Taper collection, Leone’s was a lonely voice as he urged the IHPA board to get a copy of the appraisal made before the collection was purchased. According to emails released last year in response to Freedom of Information Act requests, the foundation had wanted to keep the appraisal secret.

“After it (the Taper collection) belongs to us, it is our decision to do what makes the most sense for the ALPLM,” then foundation director and CEO Tolbert Chisum wrote in a 2007 email to Thomas Schwartz, former state historian, and Louise Taper, who owned the artifacts while sitting on the foundation board but did not vote on the sale, which had not yet been consummated. “I see no reason in ever letting it (the appraisal) out to the public, unless we need some publicity.”

IHPA board member Daniel Arnold during a 2012 board meeting said that the appraisal wasn’t the board’s business and that asking to see it could jeopardize the foundation’s relationship with the bank that loaned money for the purchase. Board minutes show that board chairwoman Sunny Fischer agreed. Fellow board member Julia Bachrach said that asking for an appraisal could undermine the foundation’s efforts to pay off the debt, minutes show.

Shirley Portwood, a retired Southern Illinois University history professor, was the only other IHPA board member who joined Leone in asking to see the appraisal. Both she and Leone were replaced on the IHPA board last year.

When the IHPA ultimately released a copy of the appraisal and emails from the appraiser last year, the documents showed that the appraiser had asked why the hat and a handful of other items in the Taper collection were considered authentic. The museum has defended the hat’s authenticity, with curator James Cornelius telling the IHPA board last year that the institution stands by the hat’s provenance – “always has and always will,” he said, even though the story of how Lincoln gave his hat away changed after the first account was discredited. It turned out that there was no evidence that the purported recipient of the hat, who allegedly received it from Lincoln during the Civil War in the nation’s capital, had been in Washington, D.C., during Lincoln’s term. In the new version, the Great Emancipator gave his hat away in Illinois two years before he was elected president. The original story was based on an affidavit prepared in 1958, when the head of the state historical library purchased the hat for his personal collection from a descendant of the man who reportedly received it from Lincoln, according to a 2012 report in the Chicago Sun-Times.

Although the ALPLM has insisted that the hat is authentic, Whalen said that the foundation is reviewing the provenance of items in the Taper collection.

“We have a special committee looking at that,” Whalen said. “We’re reviewing the allegations that have been made. … The committee is composed of board members who were not on the board at the time of the Taper acquisition.”

Why not an outside group?

“I’ll wait and see what the committee has to say,” Whalen responds.

Knorowski says that the foundation’s goal is to “serve the Abraham Lincoln Presidential Library and Museum in a way that protects, preserves and advances the legacy of Abraham Lincoln.” She also says that the foundation does not govern the institution.

But critics say the nonprofit goes too far.

“The foundation, from my standpoint, takes too much authority,” Leone says. “And they have not been prudent in a number of matters, including, first and foremost, the acquiring of the Taper collection, which unquestionably has some questionable artifacts.”

Contact Bruce Rushton at brushton@illinoistimes.com.

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